Sign up to create alerts for Instruments,
Economic Events and content by followed authors
Free Sign Up Already have an account? Sign In
jason xx
Nov 18, 2022 4:27PM ET
Ya they also said oil would hit 350 a barrel
0
0
Quotes
All Instrument Types
- All Instrument Types
- Indices
- Equities
- ETFs
- Funds
- Commodities
- Currencies
- Crypto
- Bonds
- Certificates
Please try another search
Free Webinar - Decode the market's secrets! | Tuesday, May 30, 2023 | 01:00PM EDT Enroll Now
U.S. dollar 'true' peak still a couple of quarters away -Goldman
Published Nov 18, 2022 11:53AM ET
© Reuters. FILE PHOTO: U.S. dollar banknotes are seen in this illustration taken July 17, 2022. REUTERS/Dado Ruvic/Illustration//File Photo
NEW YORK (Reuters) - Investors anxious to determine when the dollar should hit its peak may have to wait a few more quarters, Goldman Sachs (NYSE:GS) said in a research note on Friday.
Based on historical cycles, Goldman said, peaks in the dollar are typically associated with a "trough in measures of U.S. and global growth", and an easing Federal Reserve.
A dollar top would still appear to be "several quarters away," said Goldman, noting it does not expect the Fed to embark on easing until 2024. It added that U.S. growth is not expected to bottom out soon.
The U.S. investment bank noted that the dollar has drawn support from steady U.S. economic activity and still elevated inflation despite a slew of big rate hikes. The Fed has acknowledged that the concept of a "restrictive" policy rate is a moving target and estimates of the cyclical neutral rate have increased.
Goldman economists now expect a longer hiking cycle and an even higher terminal rate, in line with the Fed.
The euro area, on the other hand, still faces stiff challenges from energy shortages, while the smaller G10 economies are more sensitive to higher rates, or changes to policy rates, due in a part to the increase in variable rate mortgages.
In contrast, Goldman said the U.S. economy has a brighter economic outlook and may be less sensitive to higher rates, which should support the dollar.
Goldman's three-month forecast calls for the euro hitting $0.94 against the dollar, down about 9% from the current level. On Friday, the euro was flat at $1.0356.
Goldman said the eventual dollar peak should coincide with better global growth prospects and renewed capital flows abroad.
Still, Goldman said the dollar's highest level could come sooner than expected if the Fed pauses rate hikes, a path toward a more stable energy supply emerges in Europe or China reopens its economy faster.
Related Articles
Comments (1)
Add Chart to Comment
Confirm Block
Are you sure you want to block %USER_NAME%?
By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.
%USER_NAME% was successfully added to your Block List
Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.
Report this comment
I feel that this comment is:
Comment flagged
Thank You!
Your report has been sent to our moderators for review
Add a Comment
We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:
Enrich the conversation, don’t trash it.
Stay focused and on track. Only post material that’s relevant to the topic being discussed.
Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.
Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.