I agree with your assessment of the Fed's influence on the dollar, but I think it's wrong to say that it's the "only governmental force." For example, if Congress decides to cut spending by 50% (hypothetical obviously :P), assuming the anti-bias government provisioning system, some of the cuts will come from goods abroad. That reduces the demand for, say, the Euro relative to the Dollar, and thus causes the Dollar to rise relative to the Euro.
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I agree with your assessment of the Fed's influence on the dollar, but I think it's wrong to say that it's the "only governmental force." For example, if Congress decides to cut spending by 50% (hypothetical obviously :P), assuming the anti-bias government provisioning system, some of the cuts will come from goods abroad. That reduces the demand for, say, the Euro relative to the Dollar, and thus causes the Dollar to rise relative to the Euro.