Why the US Dollar Is Strong Despite Trade Deficits

Episode 48 of Geopolitics and Markets: Lucas and Luna unpack a paradox that has markets scratching their heads: the US trade deficit is narrowing, yet the dollar keeps climbing. They anchor on April's trade balance of -55.9 billion dollars, down from -56.6 billion, and the trade-weighted dollar index at 120.1—up over 4% since January. Lucas explains how capital flows, not trade flows, are driving the dollar's strength: foreign investors are pouring into US equities, especially after the SpaceX IPO, and into Treasuries. Luna brings up the yen at 160 per dollar, a 34-year low, and what that means for Japanese exporters. They discuss whether this dollar strength is sustainable given the current account deficit and the potential Iran nuclear deal. No clickbait—just concrete data and clear reasoning. Recorded June 12, 2026. #USDollar #TradeDeficit #StrongDollar #GeopoliticalRisk #SpaceX #IranDeal #JapaneseYen #ForeignInvestment #CapitalFlows #CurrentAccount #FederalReserve #ExportCompetitiveness #Economics #GlobalTrade #FexingoBusiness #BusinessPodcast #GeopoliticsAndMarkets #MarketAnalysis Keep every episode free: buymeacoffee.com/fexingo