GS Morning: FX Framework, TWD Update, SARB Recap, and Global Growth Risks

Goldman Sachs updates its FX framework to favor energy-importing currencies upon conflict resolution and turns bullish on TWD. Additionally, the report recaps a dovish SARB hike and quantifies global GDP risks from Middle Eastern supply shortages.

Key Takeaways

• 1.An eventual resolution to the conflict would likely trigger a rotation in FX outperformance from energy exporters to high-beta energy importers like SEK, KRW, and HUF.
• 2.Goldman Sachs has turned more positive on the Taiwan Dollar (TWD) as the drag from life insurance hedging diminishes and tech-driven equity inflows resume.
• 3.The SARB's 25bp rate hike was viewed as a dovish surprise despite upward inflation revisions due to a split 4-2 vote and scenarios already priced into the market.

Table of Contents

• 1) FX STRATEGY (JENKINS) – Resolution Ruminations
• 2) TWD Update
• 3) CEEMEA ECON (MATHENY) – SARB Recap
• 4) GLOBAL ECONOMICS (PETERS) – Assessing Global Growth Risks from Middle Eastern Supply Shortages

Document Preview

Page 1 of 5

Subscribe for full accessStart Free Trial