Biden Won’t Say It Out Loud, but He Might Want a Weak U.S. Dollar

Biden Won’t Say It Out Loud, but He Might Want a Weak U.S. Dollar
President-elect Joe Biden, accompanied by Janet Yellen, his nominee for Secretary of the Treasury, at a news conference at The Queen theater in Wilmington, Del., Dec. 1, 2020 (AP photo by Andrew Harnik).

Editor’s Note: Guest columnist Daniel McDowell is filling in this week.

“The exchange rate is the most important price in any economy, for it affects all other prices,” as Harvard political economist Jeffry Frieden put it. Since the U.S. dollar is the most widely used currency for cross-border exchange and investment, it is fair to say its value is the most important price in the global economy. Though American presidents have limited control over the dollar’s value, their words and their policy choices still carry weight. After four years of an unconventional dollar policy under President Donald Trump, what should the world expect from Joe Biden’s incoming administration?

President Biden will face the same trade-offs that all previous presidents have faced when it comes to the dollar. In general, a weaker dollar is good for economic growth and domestic producers because it makes American products more competitive relative to foreign-made products at home and abroad. With the U.S. economy facing a historic economic challenge because of the coronavirus pandemic, there are good reasons for Biden to favor a weak dollar.

Keep reading for free!

Get instant access to the rest of this article by submitting your email address below. You'll also get access to three articles of your choice each month and our free newsletter:

Or, Subscribe now to get full access.

Already a subscriber? Log in here .

What you’ll get with an All-Access subscription to World Politics Review:

A WPR subscription is like no other resource — it’s like having a personal curator and expert analyst of global affairs news. Subscribe now, and you’ll get:

  • Immediate and instant access to the full searchable library of tens of thousands of articles.
  • Daily articles with original analysis, written by leading topic experts, delivered to you every weekday.
  • Regular in-depth articles with deep dives into important issues and countries.
  • The Daily Review email, with our take on the day’s most important news, the latest WPR analysis, what’s on our radar, and more.
  • The Weekly Review email, with quick summaries of the week’s most important coverage, and what’s to come.
  • Completely ad-free reading.

And all of this is available to you when you subscribe today.