J.P. Morgan: 3 Reasons the US Dollar Is Losing Value — and Why It Might Be Good for Your Wallet

Chris Adam

Sun, Jul 6, 2025, 10:02 AM 2 min read

The U.S. dollar has long been recognized as an important currency around the world, but there have been growing concerns this year that it may be losing value.

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According to J.P. Morgan, “The U.S. dollar is the world’s primary reserve currency, and it is also the most widely used currency for trade and other international transactions. However, its hegemony has come into question in recent times due to geopolitical and geostrategic shifts.”

Specifically, J.P. Morgan noted a few reasons the U.S. dollar is losing value. It pointed to the following reasons for de-dollarization, which is the significant reduction in the use of the dollar in world trade and money transactions:

• In the commodities space, energy transactions are more often being priced in non-USD currencies.

• U.S. banks are not being involved in new payment systems used for cross-border deals.

• The USD’s share of FX reserves, a commonly used barometer of dollar importance, has decreased.

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Some financial experts who talked to GOBankingRates said there are a few ways the U.S. dollar losing value may be a good thing for the average American’s wallet.

Annie Cole, EdD, money coach and founder of Money Essentials for Women, said to think about it this way: Imagine the U.S. dollar is tied equally with the European currency — the euro. Suddenly, the U.S. dollar weakens, making European businesses more likely to look to buy American goods over European goods.

Cole said this kickstarts a cycle of foreign countries buying American goods, injecting the American economy with outside cash, potentially creating increased demand for American goods and perhaps creating more American jobs.

According to Andrew Lokenauth, money expert and owner of BeFluentInFinance, “Here’s what I tell my clients — a weaker dollar typically means stronger stock market returns. My portfolio analysis shows that when the dollar drops 10%, multinational companies in the S&P 500 often see earnings jump 15 to 20% due to overseas revenue conversion.”

Finally, Lokenauth added that inflation from a weakening dollar can benefit homeowners with fixed-rate mortgages. According to him, a 5% annual inflation rate essentially gives a homeowner a 5% discount on their mortgage balance in real terms.

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This article originally appeared on GOBankingRates.com: J.P. Morgan: 3 Reasons the US Dollar Is Losing Value — and Why It Might Be Good for Your Wallet