Although recent U.S. economic data has not shown signs of inflation — in fact, it’s been quite the opposite — a debate is raging within the economic community about whether the U.S. federal government’s unprecedented spending spree will ultimately explode into an inflationary bubble down the road — taking the dollar down with it.

Such a prospect could have a dramatic impact on the U.S. dollar, which has enjoyed, ironically, its strongest rally in years in recent months as the financial panic unfolded.

For now, inflation remains a "what-if" scenario, with the total March consumer price index (CPI) posting a 0.4-percent annual decline, the first annual drop since 1955; the "core" CPI rate, which excludes food and energy, gained 0.2 percent.

However, with the asset side of the U.S. Federal Reserve’s balance sheet now bloated to a historic nearly $2.2 trillion mark as of mid-April, and with the door open for it to expand to $3 or $4 trillion before the economic recovery and stimulus efforts conclude, inflation remains a real issue for traders to consider.