Goldman Sachs Cuts Expectations for the Dollar After Fed's Big Rate Cut
After the Federal Reserve's big rate cut, Goldman Sachs under expects the dollar to gradually weaken as yields lose their appeal. Goldman Sachs instead raised its forecasts for several major currencies, including the euro, pound and yen.Goldman strategists such as Kamakshya Trivedi wrote in the report, ‘We continue to believe that the high valuation of the dollar will not erode quickly or easily, but the bar has been lowered a bit.’ Based on its latest forecasts for the dollar, Goldman Sachs, which has been bullish on sterling since the beginning of the year, now expects the pound to reach 1.40 against the dollar in 12 months, up from its previous view of 1.32. It's the first time the outlook has reached that level since 2021, and ranks among Wall Street's highest forecasts.
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