The dollar will disappoint analysts expecting a broad rally in the currency versus major peers as a tapering of Federal Reserve stimulus isn’t improving the U.S.’s interest-rate advantage, according to Goldman Sachs Group Inc.
Japanese investors overseeing $47 billion say the Aussie’s strongest rally in five months is a false dawn, as a slowdown in China’s factories overshadows signs of strength in the South Pacific economy.
Volatility in foreign exchange markets, after falling to some of the lowest levels since before the financial crisis, has nowhere to go but up as emerging economies falter, say the world’s biggest dealers.
Goldman Sachs Group Inc.’s Thomas Stolper, who correctly predicted the dollar’s slide against the euro this year, is deviating from the consensus that the greenback will be among the best currencies to own in 2014.
The yen slid to the weakest since June 2010 versus the dollar after Japanese Prime Minister Shinzo Abe’s government said it will spend 10.3 trillion yen ($116 billion) in new stimulus efforts that may weaken the currency.