#FedRateCutAffectsDollarTrend Yes, the U.S. dollar's trend is strongly affected by the Federal Reserve's interest rate decisions. Here's how: 1. Rate Hikes → Stronger Dollar Higher interest rates attract foreign investors seeking better returns on U.S. assets (bonds, stocks). Increased demand for the dollar strengthens its value. A stronger dollar makes U.S. imports cheaper but can hurt exports. 2. Rate Cuts → Weaker Dollar Lower interest rates reduce the appeal of U.S. assets. Investors may move money to countries with higher yields, reducing dollar demand. A weaker dollar makes U.S. exports more competitive but raises import costs, contributing to.