Analysts warn it is risky business playing politics with the U.S. currency, which has traditionally been off limits as a play to score points against political opponents.
That taboo appears to have been broken.
Republicans in Congress said the previous Republican administration of former President George W. Bush also deserved blame for dollar weakness but, since taking office on January 20, Democrat Obama was calling the shots.
"I agree with her," Senator Charles Grassley, top Republican on the Senate Finance Committee, said when asked by Reuters about Palin's dollar criticism.
"A lot of the recession we are in now goes back to Bush. But the extent to which we passed the $787 billion stimulus bill that is not doing any good -- this president is responsible for," he said.
"It is not the Bush administration anymore. It is nine months into this administration. You can't blame Bush anymore," Grassley added.
“The dollar has always been a testosterone issue among America’s political classes,” said Norm Ornstein, a veteran analyst at the conservative American Enterprise Institute.
“This time there may be a legitimate debate to be had over the dollar’s reserve status, but Sarah Palin is not qualified to participate in it.”