NEW YORK (Real Money) -- The U.S. dollar is looking weak. Recently it hit a three-month low against Canada and it's threatening to do the same against the Aussie dollar. Even the euro appears to have gotten up off the mat. As for the British pound, well, despite posting some of the weakest economic numbers in three years, Britain's currency is nearing a six-week high against the greenback. The dollar index? It's off its highs, too. Down about 4% since the peak in March and looking like a top.

The story looks the same all over. "King Dollar" is giving up some of its torrid gains of the past year.

What explains this dollar weakness? Is the rally over or is this just a pause before the next major leg up?

My guess is that the dollar's long-term uptrend, which really started in 2009, is over for now.

Consider the facts. The main story behind the dollar's rally over the past several years was one of divergence. That divergence being, the U.S. economy was nearing the end of its need for central bank "stimulus" while the rest of the world was either continuing to have problems or witnessing increasingly aggressive central bank action on interest rates and exchange rates.

For one, that story is known now and fully discounted, I think. Secondly, there has been some improvement in underlying fundamentals in some currencies. German export growth is surging and Japan has seen the return of trade surpluses. As for the Canadian dollar, it's been helped by the rebound in oil prices, etc.

I even believe there is more to it than that. I seriously think the prospect of higher rates in the U.S. is longer-term bearish for the dollar. I know that seems counterintuitive, but so was the thinking that lower rates and quantitative easing by the Fed would be the end of the dollar. Remember those warnings? There were many people who said the Fed's actions would bury the dollar, and what happened? The opposite. The dollar climbed.

I know you've heard me say this ad nauseum, but a rate hike by the Fed really equates to printing money. I'm talking about the real kind of money printing, not the fake, monetary operations stuff that the Fed does. Like when it simply exchanges securities for reserves. That's not money printing.

TheStreet Recommends

Case in point: If you have $1 million in Treasurys and I'm the Fed and I buy your Treasurys and give you $1 million in the bank, that does not change your net worth. You're still worth $1 million (assuming no liabilities).

However, if you have $1 million in Treasurys and I'm the government and I give you a check for $20,000 (interest payment), you now have $1,020,000. Your net worth has gone up by $20,000 (all else being equal). That's money printing.

If you look back at the Reagan era, interest payments by the federal government really took off. It was the largest component of government spending at the time. That was money printing and it caused the dollar to fall. It was a massive fiscal injection.

Same thing will hold true this time.

Either way, I think the dollar will remain under pressure. If the Fed backs off its "lean" toward higher rates, then I think investors will pound the dollar. On the other hand, and if rates are raised after that initial knee-jerk reaction of dollar buying, the buck will start to head lower and remain headed downward.

Either way, I think the dollar loses for now.

Editor's Note: This article was originally published at 12 p.m. EDT on Real Money on April 28.

This article is commentary by an independent contributor. At the time of publication, the author was short USDJPY.