Goldman Sachs believes that the energy shock will keep interest rates high and drive the US dollar stronger.
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Goldman Sachs strategist Karen Reichgott Fishman stated: “The combination of (US) rising inflation and resilient growth already implies that rates will remain higher-for-longer. Any additional concerns about the duration of the energy shock should continue to drive relative returns in line with changes in terms of trade. This scenario should also boost the US dollar broadly against G10 currencies.”
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