The U.S. Dollar Index has bounced back from a slow start to 2026 and is now up 1.2% this year. The dollar tends to outperform when the economy is booming and interest rates are rising, and the bond market is pricing in at least one Federal Reserve interest rate hike by mid-2027. However, a combination of unpredictable policy decisions, U.S. money supply expansion and rising government debt levels could still produce a bearish long-term outlook for the dollar. Fortunately, a weaker dollar could create some attractive investment opportunities.
[Sign up for stock news with our Invested newsletter.]
Here are seven ways to invest in a falling dollar:
— U.S. companies generating international sales.
— International developed market stocks.
— Emerging market stocks.
— Commodities.
— Precious metals.
— Cryptocurrencies.
— International currency ETFs.
U.S. Companies Generating International Sales
A weaker dollar can be good news for U.S. companies that do business abroad.
When the U.S. dollar is strong, companies generating international sales effectively earn fewer dollars and generate lower earnings than expected. However, a weaker dollar means goods and services being purchased with U.S. dollars become more expensive for the consumer.
Qualcomm Inc. (ticker: QCOM), Philip Morris International Inc. (PM) and Las Vegas Sands Corp. (LVS) are just three examples of U.S. stocks that generate the majority of their total revenue overseas.
International Developed Market Stocks
In addition to protecting against a weaker U.S. dollar, international stocks can diversify your investment portfolio away from U.S. stocks and the U.S. economy. By focusing on developed international markets, such as Europe, Japan and South Korea, investors can also mitigate risks associated with high-growth, high-volatility emerging markets. Developed markets won’t provide the type of growth emerging markets will, but their economies are typically more stable and reliable.
Nicole Tanenbaum, partner and chief investment officer at Chequers Financial Management, says foreign stocks stand to benefit from both currency appreciation relative to the dollar and capital appreciation over time.
“A weaker U.S. dollar increases the value of overseas earnings when translated back into dollars, boosting returns for U.S. investors. Additionally, many international markets trade at cheaper valuations compared to U.S. equities, offering diversification and potential upside,” Tanenbaum says.
The Vanguard FTSE Developed Markets ETF (VEA) is a popular fund for diversified exposure to international developed markets. The fund’s top holdings include stocks like Nestlé SA (NESN.SW), ASML Holding NV (ASML) and SAP SE (SAP).
Emerging Market Stocks
International companies in high-growth emerging markets that have relatively low exposure to the U.S. economy also benefit from a weaker dollar. Many emerging market governments and companies borrow heavily in U.S. dollars to invest in their growth initiatives. When the dollar weakens relative to their local currencies, the burden of that debt becomes lighter and the health of their balance sheets improves.
Investors who want to take an aggressive approach to investing in international stocks can target emerging markets such as China, India and Brazil. The Vanguard FTSE Emerging Markets ETF (VWO) is one of the largest and lowest-cost emerging market exchange-traded funds available.
[Read: Will the Stock Market Crash in 2026? 5 Risks to Consider]
Commodities
Since most commodities traded on international markets are priced in U.S. dollars, a weaker dollar means higher commodity prices. As the dollar falls in value, it takes more weaker dollars to purchase a commodity, driving the commodity’s price higher. Likewise, dollar-based commodity prices must rise to match the effective price of global competitors pricing commodities in other currencies.
Crude oil prices have historically had a particularly negative correlation with the U.S. Dollar Index.
Kiana Danial, CEO of Invest Diva and author of “Triple Compounding for Dummies,” says higher commodity prices are good news for the energy and materials sectors.
“When the dollar weakens, commodities like oil, copper and agricultural products typically strengthen. Why? They’re priced globally, and they become cheaper for foreign buyers,” Danial says.
Investors looking to bet on commodities in 2026 can buy popular commodities funds, such as the Invesco Optimum Yield Diversified Commodity Strategy No K-1 ETF (PDBC) and the United States Oil Fund (USO).
Precious Metals
Like commodities, gold is generally priced in U.S. dollars. The dollar is no longer backed by physical gold, but the value of the dollar is one of many factors that impact gold’s value. Gold prices have soared in recent years as investors use the precious metal to hedge against inflation. However, investors also use gold as a stable store of value during periods of currency volatility. Silver has performed even better as of late, outperforming gold by a wide margin during an extended period of dollar weakness in 2025.
David Miller, chief investment officer and senior portfolio manager at Catalyst Funds, says high gold and silver prices are a direct reflection of investor fears surrounding the dollar’s outlook.
“Gold’s strength alongside strong equities suggests investors are increasingly focused on long-term purchasing power protection rather than a risk-off trade,” Miller says.
“Persistent inflation, record fiscal deficits and geopolitical uncertainty are pushing investors to own real assets as insurance.”
To avoid losses tied to a declining U.S. dollar, investors can buy shares of the popular SPDR Gold Trust (GLD) or the more volatile VanEck Gold Miners ETF (GDX). The iShares Silver Trust (SLV) is also a popular way to invest in silver.
Cryptocurrencies
Investors with the stomach for extreme volatility can invest in Bitcoin (BTC), Ethereum (ETH) and other popular cryptocurrencies to play a weaker dollar. The price of cryptocurrencies is typically denominated in dollars, and many investors see Bitcoin and other cryptos as digital versions of currencies or commodities.
In the long term, Bitcoin has been an exceptionally strong investment, but its extreme volatility is not for the faint of heart. In fact, Bitcoin has only had one calendar year since 2015 in which it gained or lost less than 59%.
International Currency ETFs
One of the most straightforward ways to profit from a weaker dollar is to invest in other fiat currencies. Foreign exchange traders can make bets on currency pairs directly, but there are also publicly traded trusts and funds that allow investors to buy and sell international currencies just like stocks. For example, the Invesco CurrencyShares Euro Trust (FXE) is an easy way to bet on the euro, while the Invesco CurrencyShares Japanese Yen Trust (FXY) provides exposure to the yen.
However, currency investors should understand that these pairs are a zero-sum game. These international currencies will gain value only during periods of U.S. dollar weakness and will lose an equal and opposite amount of value during periods of U.S. dollar strength.
More from U.S. News
7 Best Data Center Stocks, ETFs and REITs to Buy
7 Undervalued Stocks to Buy Now
5 Best Nuclear Energy Stocks and ETFs to Buy
7 Ways to Invest With a Weakening U.S. Dollar originally appeared on usnews.com
Update 06/03/26: This story was published at an earlier date and has been updated with new information.
