With Dollar Under Siege, Gold Breaks Out
For more than 80 years, the U.S. dollar has been the backbone of America’s economic strength and global influence.
Since 1944, it’s held the unique role as the world’s primary reserve currency. Bringing with it stability, power, and respect.
But that foundation is cracking, and too many Americans don’t realize what’s at stake.
A Historic Decline
In the last six months, the dollar has lost over 10% of its value compared to other major currencies, the steepest fall since 1973. The dollar’s worst start in fifty years has pushed it to a three-year low.
Meanwhile, currencies like the euro are surging.
This isn’t just a temporary wobble.
It’s a sign of deeper trouble.1
Why Investors Are Turning Away
You might think a strong stock market means the U.S. economy is booming.
And to some extent, it is.
But global investors are losing faith in America’s long-term prospects.
Tariffs, rising deficits, and ballooning debt have made lending to the U.S. less attractive.
Simply put, the returns investors expect are shrinking as growth slows.
The Trump administration’s hope was that tariffs would strengthen the dollar by making Americans buy fewer foreign goods, thereby weakening other currencies. Instead, tariffs fueled inflation fears and hurt growth.
Exactly the opposite of their intention.
As AIInvest recently said, "This decline isn’t merely cyclical — it reflects a structural shift in global finance."2
The Dollar’s Place in the World Is Changing
At the IMF and World Bank meetings earlier this year, officials publicly insisted the dollar remains irreplaceable.
But behind closed doors, many admitted they are eager for an alternative.
That’s a new and worrying development.
Restoring confidence in the dollar would require serious reforms: cutting deficits, practicing fiscal discipline, keeping the Federal Reserve independent, and avoiding weaponizing the currency as a political tool. Those changes are nowhere in sight.
Central banks are already reducing their dollar holdings, from 70% down to 58% of reserves, and buying more gold instead.
Meanwhile, the BRICS nations are moving toward local currency transactions, aiming to chip away at America’s dollar dominance. The international demand for dollars is on a downward trajectory. 3
Inflation, Debt, and a Crisis of Confidence
Fears of rising inflation are one reason the dollar has been weakening. Inflation is a silent thief, quietly eroding your purchasing power and undermining the dollar’s value.
The problem has only gotten worse with a new federal budget that threatens to add trillions to an already massive national debt.
This growing debt fuels inflation worries, rattles the Treasury markets, and scares off investors. Flip-flopping trade policies and political attacks on the Federal Reserve are creating uncertainty about America’s economic leadership.
And the Fed’s inconsistent rate cuts have narrowed the U.S. yield advantage, making the dollar even less attractive.
Bob Elliott, chief investment officer at Unlimited Funds, puts it plainly: "The U.S. is not only reliant on foreign goods but also on foreign capital to support our financial markets."
When foreign investors pull back, America’s financial system comes under strain. The weakening dollar is another step toward a debt-driven doom loop that could ultimately crash the U.S. economy.4
What a Weakening Dollar Means for You
A falling dollar isn’t just a headline, it hits your wallet:
—Traveling abroad suddenly costs more because your dollar buys less
—Prices on imported goods rise, pushing inflation higher
—Foreign investors shy away from U.S. stocks and bonds, making it harder to finance America’s trade deficit.
—Even with record-high stocks, U.S. markets lag behind Europe as investors diversify away.
Some American industries like manufacturing and hospitality might see a short-term boost from a weaker dollar. But that won’t be enough to keep the whole economy afloat if growth continues to slow.
A Dangerous Cycle of Decline
If growth weakens, the Federal Reserve will likely cut rates again.
That will make U.S. assets even less appealing to foreign investors, sending the dollar lower still.
As a result, buying goods from overseas will become even more expensive. It's a vicious cycle that could trap the U.S. in stagflation, where inflation rises while growth stalls.
This past 4th of July, the Atlantic Council warned, "This isn’t a call to panic, but it is a warning. Even as Old Glory flies high this weekend, the dollar is showing concerning wear. History shows the consequences of inattention."5
Why Gold Is Your Best Hedge
The era of dollar dominance is fading, and exposure to dollar-based assets leaves your portfolio vulnerable to inflation, geopolitical risk, and shifting global power.
That’s why gold remains the ultimate hedge against a falling dollar.
Often called the "currency of last resort," gold tends to rise when the dollar falls.
In just the second quarter of 2025, gold climbed 5%, hitting $3,415 per ounce in just six days as the dollar dropped sharply.
Central banks are buying gold in increasing amounts, showing that institutional investors trust it as a safe haven in uncertain times.6
Conclusion
The dollar’s decline is real and it’s gaining momentum.
Don’t wait for the situation to get worse before acting.
Gold offers a proven, time-tested way to safeguard your savings and protect your financial future. Call American Hartford Gold today at 800-462-0071 to learn how a Gold IRA can help you hedge against the dollar’s decline.
Max Baecker is the President of American Hartford Gold (AHG), the nation’s largest retailer of precious metals. He leads American Hartford Gold’s mission to help clients achieve long-term financial security with physical gold and silver.
Under his guidance, American Hartford Gold has delivered billions of dollars’ worth of precious metals to thousands of satisfied clients.
Max's dedication to upholding American Hartford Gold's industry-leading standards is reflected in its accolades. American Hartford Gold has made numerous high-ranking appearances on the prestigious Inc. 5000 List of America’s Fastest-Growing Private Companies. AHG holds an A+ Rating from the BBB and a 5-Star Rating on Trustpilot from thousands of American Hartford Gold reviews. American Hartford Gold is the only precious metals company trusted and recommended by Bill O’Reilly.
AHG offers investment-grade gold and silver coins and bars at competitive prices. Clients also benefit from its buy-back commitment with no back-end fees. To learn more, visit American Hartford Gold.
Notes:
1. https://apple.news/AAdAeYXq8S5yFc4cr-UY0UA
2. https://www.ainvest.com/news/dollar-downfall-navigating-de-dollarization-currency-diversification-strategic-allocations-2507/
3. https://www.ainvest.com/news/dollar-downfall-navigating-de-dollarization-currency-diversification-strategic-allocations-2507/
4. https://apple.news/AAdAeYXq8S5yFc4cr-UY0UA
5. https://www.atlanticcouncil.org/content-series/inflection-points/an-independence-day-warning-about-the-us-dollar/
6. https://www.ainvest.com/news/gold-golden-cross-technical-fundamental-bullish-convergence-dollar-weakness-geopolitical-storms-2507/