Goldman Sachs Backs Carry Trades in $9.5 Trillion FX Market as Backdrop Hits 20-Year Best
Updated
Updated · Bloomberg · Jul 10
Goldman Sachs Backs Carry Trades in $9.5 Trillion FX Market as Backdrop Hits 20-Year Best
3 articles · Updated · Bloomberg · Jul 10
Summary
More than two decades after 2000, Goldman says G10 currency carry trades now offer their strongest setup, urging investors to borrow in low-yielding currencies and buy higher-yielding ones.
Stuart Jenkins wrote that the strategy has more relevance in the Group of 10 foreign-exchange market than at almost any point since 2000, pointing to an unusually favorable yield backdrop.
Goldman currently favors using the yen, Swiss franc or euro as funding currencies in the months ahead, highlighting where it sees the cheapest borrowing base.
The call targets one of the most widely used strategies in the $9.5 trillion-a-day FX market, giving the recommendation broad significance across global currency trading.