How the Dollar, Gold, and International Stocks Fit Into Your Portfolio
Global events have been shaping financial markets, with geopolitics and new tariffs drawing a lot of investor attention. But one important factor that often gets overlooked is the value of the U.S. dollar. Currency movements can quietly affect your portfolio through their impact on international investments, commodities like gold, and the overall economy.
The dollar has declined from its 2022 peak but has bounced back somewhat recently, as investors tend to seek safety in dollar-denominated assets during uncertain times. Understanding what this means for other assets — like international stocks and gold — can help investors stay on track toward their financial goals.
Partnering with a Christian financial advisor can help investors evaluate how assets like the dollar, gold, and international stocks fit within a broader Christian financial planning framework. A TrueVine Family Wealth financial advisor in Naples, FL may offer perspective that emphasizes long-term strategy, diversification, and alignment with individual goals and values.
Three Things Investors Should Know About The Dollar
After peaking around 114 on the dollar index (DXY) in 2022, the dollar weakened as global growth stabilized. Tariffs pushed it below 100 for the first time in three years, though it has since partially recovered. Even with the decline, the dollar remains stronger than its long-term historical average.
Here are three key facts to keep in mind. First, a stronger dollar is not always a good thing. While it makes imported goods and overseas travel cheaper for consumers, it also makes U.S. products more expensive for foreign buyers, which can hurt American businesses competing globally.
Second, the dollar’s value is shaped by many factors, including interest rates, trade policy, and government spending. Interestingly, last year’s tariffs actually weakened the dollar rather than strengthening it — partly due to concerns that ongoing government budget deficits could erode the dollar’s economic standing over time.
Third, the dollar has rebounded since late January as geopolitical tensions have led investors back to safer assets. The dollar remains the world’s most widely used currency for international trade and reserves. While its dominance has been questioned before — during Japan’s rise in the 1980s, the introduction of the euro, and the growth of digital currencies — investors still tend to return to the dollar during difficult periods.
A Weaker Dollar Has Boosted Returns From International Stocks
The dollar’s decline over the past year has helped international stock returns. In 2025, developed market stocks (MSCI EAFE) returned 31.9% and emerging market stocks (MSCI EM) returned 34.4% in U.S. dollar terms — both ahead of the S&P 500. This highlights why diversifying globally can be valuable.
When a U.S. investor holds international stocks, those assets are priced in local currencies. If the dollar weakens, those foreign currencies convert back into more dollars, boosting returns. So currency movements add an extra layer to international investment performance.
International stocks also look more affordable compared to U.S. stocks. Developed markets trade at a price-to-earnings ratio (a common measure of how expensive a stock is relative to its earnings) of 14.9x and emerging markets at 11.8x, compared to 19.9x for the S&P 500. While this doesn’t predict short-term returns, it’s a useful input when building a balanced portfolio. So far in 2026, international markets have continued to modestly outperform U.S. stocks, reinforcing the case for maintaining global diversification.
A TrueVine Family Wealth Southwest Florida financial planner who specializes in Christian financial planning can assist in assessing how different asset classes interact within a diversified portfolio. Working with a Christian financial advisor allows for thoughtful consideration of risk, time horizon, and overall investment objectives without overreacting to short-term market movements.
Gold Has Pulled Back After Reaching Record Highs
Gold has been widely discussed in recent years, driven higher by factors such as rising government deficits, lower interest rates, and geopolitical tensions. These forces pushed gold to an all-time high of $5,417 per ounce in late January. Since then, gold has declined roughly 14% from that peak, even though many of the same factors are still present.
Part of the reason is that gold had already attracted a lot of investor interest during its rally. When many investors pile into an asset expecting further gains, it can start moving more in line with other assets — meaning it may be sold during market stress rather than acting as a buffer. The dollar’s recent recovery has also weighed on gold prices, as the two often move in opposite directions.
This isn’t the first time gold has behaved unexpectedly. Between 2011 and 2020, gold was essentially flat despite low interest rates and periods of financial uncertainty. The most useful way to think about gold is as one piece of a broader, diversified portfolio — not as a standalone solution. Its value lies in the fact that it tends to behave differently than stocks and bonds, which can help smooth out portfolio performance over time.
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Information presented is believed to be factual and up-to-date, but we do not guarantee its accuracy and it should not be regarded as a complete analysis of any subjects discussed. All expressions of opinion reflect the judgment of the authors on the date of the post and are subject to change. Blog posts were prepared by Clearnomics, a third-party content provider.
You should consult with a professional advisor before implementing any strategies discussed. Content should not be viewed as an offer to buy or sell any of the securities mentioned or as legal or tax advice. You should always consult an attorney or tax professional regarding your specific legal or tax situation. Estate planning rules and regulations are subject to change at any time.
All investments have the potential for profit or loss. Different types of investments and strategies involve higher and lower levels of risk. There is no guarantee that a specific investment or strategy will be suitable or profitable for an investor’s portfolio. Asset allocation, rebalancing, and diversification will not necessarily improve a client’s returns and cannot eliminate the risk of investment losses.
Historical performance returns for investment indexes and/or categories, usually do not deduct transaction and/or custodial charges or an advisory fee, which would decrease historical performance results. There are no guarantees that an investor’s portfolio will match or outperform a specific benchmark. Historical returns do not represent the performance of TrueVine or any of its advisory clients.
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