This is via the folks at eFX.

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  • Goldman Sachs discusses the USD outlook in 2023 and sees a scope for another leg higher in the USD before forming a peak and turn.
  • "The US Dollar still has a lot going for it. US activity and labor markets are proving resilient, and on our modal path the US economy is likely to avoid recession. However, increasing financial stability, mortgage market, and recession concerns in many other parts of the world mean that other global central banks may struggle to keep up with the Fed," GS notes.
  • "There are risks on both sides. We may need to wait longer for a Dollar turn if we move squarely towards a recession in the US and there is a marked worsening in the risk-taking environment..
  • On the other side, an early end to China's zero-Covid policies in line with recent signals and price action or an unexpected easing in Russia-Ukraine tensions would likely set in motion macro and market dynamics that could contribute to an earlier Dollar turn by fostering a better environment for global growth and risk assets," GS adds.
via Goldman Sachs