FXStreet reports that economists at Natixis examine the variables that seem to have heavily influenced the dollar’s exchange rate. 

“We clearly see a negative correlation between the yield spread (United States-Europe) and the dollar’s exchange rate against the euro and a positive correlation between the ratio of the monetary bases (United States/eurozone) and the dollar/euro exchange rate.”

“We note a significant link between the yield spread (United States-world) and the dollar’s trade-weighted exchange rate (the trade-weighted exchange rate increases when the dollar appreciates); and a significant link only since 2010 between the ratio of the monetary bases and the dollar’s trade-weighted exchange rate.”

“We see significant correlations with the expected sign between the US current account balance and the dollar/euro exchange rate and the dollar’s trade-weighted exchange rate, but no significant correlation of the right sign with US external debt.”

“We see a significant link and the expected sign between risk aversion and global growth and the dollar’s exchange rate (both dollar/euro and trade-weighted exchange rates).”