Goldman Sachs Doubts Intervention on Euro, But Action on Yen Possible
- Two currencies have slid at least 10% versus dollar this year
- ECB has a host of more pressing challenges, Goldman says
This article is for subscribers only.
The European Central Bank is unlikely to step directly into foreign-exchange markets even in the face of a more than 10% slump in the euro this year, although there’s potential for Japan to engage in that kind of intervention if the yen keeps sliding, according to Goldman Sachs Group Inc.
The US dollar, fueled by a combination of aggressive Federal Reserve monetary policy and haven buying, is trading near its strongest level in decades, steamrolling currencies from Hungary to New Zealand. The euro and yen -- the greenback’s most widely traded peers -- have struggled to hold their ground, while some countries such as Chile and India have already taken direct action in support of their currencies.