BRICS: Goldman Sachs Predicts US Dollar Will Experience a Boom

The BRICS alliance might not be able to deter the US dollar as Goldman Sachs predicts the currency could experience a tariff-fueled boom. Currency traders could make Stellar profits if they take long positions on the USD, wrote the global investment bank. Tariffs from the Trump administration could bolster the appeal for the greenback leading to further gains, the note from the bank read.

If the US dollar continues its rise in the charts, BRICS will have a hard time safeguarding their respective local currencies. The development could derail the de-dollarization agenda and lead to the greenback strengthening further. The USD faced severe challenges from BRICS who were looking to dethrone it from the world’s reserve currency status.

BRICS: Tariffs Could Fuel US Dollar Boom, Says Goldman Sachs

The escalating trade wars could benefit the US dollar in the long haul, wrote Goldman Sachs in a note and the development could impair the BRICS bloc.wrote Goldman Sachs strategists Karen Reichgott Fishman and Lexi Kanter in a note.

Trump’s protective style of governance could drive inflation but in turn, support US yields, the note read. The tariffs are ruffling a lot of feathers in the markets as they directly affect the imports and exports sector. BRICS was looking to outdo the US dollar but found itself in a stiff economic situation.

The local currencies of BRICS countries have already plummeted to new lows against the US dollar this year. The de-dollarization initiative could stagnate for the next four years as threats of tariffs loom from Trump. Read here to know the full list of tariffs imposed by Trump since he took office.