Inflation is one of the main reasons to raise interest rates, but currently inflation is not following the usual numbers when it This is a growing economy. Inflation is expected to rise over this period, but is currently falling. So if inflation does not rise as expected, the dollar will also be stronger than expected. However, a strong dollar is a good thing and a bad thing, it is a bad thing because it will make our exports more expensive for other countries. While many other economies have struggled recently, U.S. exports could take a hit due to falling conversion rates. Now, if the Fed raises interest rates to combat inflation, the strength of the dollar could remain high, which could hurt our country's export market.