×

The dollar is doing something it hasn't done in 6 years. Here's what it means

The dollar index just closed its fifth straight month of losses, its longest monthly losing streak since 2011. One portfolio manager said in an interview Monday that, despite this weakness, he wouldn't be surprised to see some relief for the greenback ahead.

"When I look to the next twelve months, I wouldn't be surprised to see the Federal Reserve raise interest rates two to three times, as well as start to slowly reduce their balance sheet. That should bring some more life, or breathe some more air, into the U.S. dollar," Chad Morganlander of Washington Crossing Advisors, said Monday on CNBC's "Trading Nation."

For this reason, Morganlander said he wouldn't be "such a dollar bear at this point."

Higher interest rates, which are to be expected as the Federal Reserve is in the midst of a tightening cycle, typically boost the value of a country's currency relative to the value of foreign currencies.

The dollar index, which measures the value of the U.S. dollar relative to a basket of foreign currencies (largely the euro), has dipped over 9 percent year to date as the likelihood of President Donald Trump's pro-growth agenda getting underway has come into question.

The dollar index turned red midday Monday following news that the president's communications director, Anthony Scaramucci, would leave the administration.

Videos

Trades to Watch

Trader Bios

About

Trading Nation is a multimedia financial news program that shows investors and traders how to use the news of the day to their advantage. This is where experts from across the financial world – including macro strategists, technical analysts, stock-pickers, and traders who specialize in options, currencies, and fixed income – come together to find the best ways to capitalize on recent developments in the market. Trading Nation: Where headlines become opportunities.

Brian Sullivan

Brian Sullivan is co-anchor of CNBC's "Power Lunch" (M-F,1PM-3PM ET), one of the network's longest running programs, as well as the host of the daily investing program "Trading Nation." He is also a frequent guest on MSNBC's "Morning Joe" and other NBC properties.

Read more

Connect