Goldman Sees Dollar Rallying 5% or More as US Growth Dominates

Goldman Sachs Group Inc. has upgraded its dollar forecasts, citing a robust US economy and likely higher tariffs that may slow monetary easing.

“We expect the dollar to rally by about 5% over the coming year on the realization of new tariffs and continued US outperformance,” strategists including Kamakshya Trivedi wrote in a note. Even with this upgrade, “we still see the risks tilted towards more dollar strength.”

It was Goldman’s second upward adjustment to its dollar call in about two months, underpinned by consistently strong US growth and Donald Trump’s planned tariffs that risk fanning inflation and derailing Federal Reserve easing. Optimism about the greenback looks set to gain more traction after Friday’s blowout jobs report that reinforced views of a resilient labor market, boosting the currency’s outlook against peers from the euro to the Australian dollar.

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