This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Here's How to Profit When U.S. Dollar Flies on Accelerated Inflation

Stock quotes in this article: UUP, FXE, BAC

NEW YORK (TheStreet) -- A divergent economic trend between Europe and the Unites States could set the stage for a prolonged rally in the U.S. dollar, while the euro weakens.

PowerShares DB US Dollar Index Bullish (UUP), a fund designed to track the value of the U.S. dollar, could continue to move upward as the weak European economy and the rising inflation in the United States lead funds into the dollar.

As the economic activity falters and inflation remains subdued, the European Central Bank is expected to continue enacting a loose policy over the next year.

Earlier this month, Germany surprised forecasters when it posted sharply lower industrial production for May, falling 1.8% month on month on a seasonally-adjusted basis, well below the consensus for a flat reading and April's downward-revised decline of 0.3% (from 0.2%).

Dodd-Frank, 4 Years In, Is Vague, Complex, and Still Fighting the Last War

5 Hated Earnings Stocks You Should Love

Lower Duration, Mitigate Risk With Liquid Alternative Funds

As shown in the chart below, German industrial production has declined steeply since the beginning of 2014.

German economic data courtesy of TradingEconomics.com

The decline in the annualized output comes alongside a core inflation rate in the euro area that remains stuck between 0.7% and 1.0% annual growth, well below the ECB's 2% target.

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,804.71 -238.19 -1.40%
S&P 500 1,946.16 -26.13 -1.32%
NASDAQ 4,422.0850 -71.3050 -1.59%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs