Currencies
Goldman Sees Risk of 10% Drop in Euro If Trump Wins US Election
- Bank keeps $1.10 year-end forecast, sees parity as possibility
- FX analyst says Chinese yuan could weaken to 8 per dollar
Donald Trump speaks during a campaign event in Butler, Pennsylvania, on Oct. 5.
Photographer: Justin Merriman/BloombergThis article is for subscribers only.
Goldman Sachs Group Inc. said the euro could drop as much as 10% versus the dollar if Donald Trump and the Republicans win next month’s US elections and enact high global tariffs and generous domestic tax cuts.
The bank already believes that an outperforming US economy and relatively high rates will keep the dollar strong, and it sees a risk that strength in the greenback could last even longer than its forecasts if next month’s vote results in “much higher” tariffs. It also said the yuan could fall 12% under that scenario.