Goldman Sachs with a view on the euro, running 'tariff' scenarios for the US election outcome:
- if the Republican party win the presidency and Congress could lead to higher tariffs
- 10% U.S. tariff on all imports
- 20% on Chinese products
- tax cuts
- would likely push up inflation
- would likely lead to Federal Reserve interest rate rises, to US rates much higher than in the EU
- could cause the US dollar to rise sharply and euro to drop by up to 10%
GS also run a scenario on a narrower trade war, in which Trump only imposes further tariffs on China, could see the euro fall by around 3%.
GS on a Democratic sweep or divided Democratic government:
- likely result in some initial dollar downside
