The present paper introduces a new index of the real value of the dollar relative to eighty other currencies. The individual exchange rates are combined with weights that reflect the recent (1984) multilateral pattern of trade. This new index confirms that the dollar rose very sharply between January 1980 and February 1985 and that about three-fourths of that appreciation was reversed by May 1987. This observation is true for both our multilateral and bilateral real indices. The analysis also shows that any index that fails to adjust for differences in inflation rates will give a very misleading impression of the dollar's evolution in the 1980s.