FOREX NEWS & BLOG

Bank of America pm Sterling, looking for gains in 2025. BoA cite

1. UK unlikely to be the focal point of Trump’s trade tariff plans
2. UK reliance on its service sector will also offer some protection against any tariffs
3. direction of travel in Brexit is less hostile under the UK Labour government

BoA not looking for immediate sustained gains:

• stronger dollar following the US election a limiting factor near term

But EUR/GBP likely to drop in 2025 amid political and fiscal volatility in the eurozone.

This article was written by Eamonn Sheridan at www.forexlive.com.

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Goldman Sachs sees gold as a strong hedge against potential risks from Trump-era tariffs, predicting prices will rise further in 2025.

I posted on their forecast yesterday:

• Goldman Sachs have reiterated their gold target of $3,000 an ounce by December 2025

Adding a little more now:

• GS highlights gold’s role as a safe haven during heightened Trump trade tensions and tariff increases
• current policy uncertainty and recent market consolidation create a favorable opportunity for investing in gold
• structural demand from central banks and cyclical factors, like expected Federal Reserve rate cuts, as key drivers

This article was written by Eamonn Sheridan at www.forexlive.com.

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A note via Capital Economics argues:

• While Trump’s trade policies receive attentionon, immigration restrictions may have a more substantial economic impact, potentially leading to lower growth and higher costs across critical sectors.

Capital Eco says, in brief, that the immigration policy will reduce economic growth in the US by around 1% a year:

• Proposed Restrictions:
  • Plans to remove up to 1 million undocumented immigrants annually.
  • Likely significant reduction in immigration, affecting labor supply.
• Economic Impact:
  • Immigration has driven 80% of US labor supply growth, sustaining economic growth amid high interest rates.
  • Reduced immigration could lower US potential GDP growth by ~1% annually.
  • Sectors reliant on migrant labor (e.g., construction, agriculture, hospitality) would face higher costs, leading to increased prices.
  • Immigration measures could result in a stagflationary hit to the economy.

If you want more, the full note is here, link. Worth being aware of the implications of new policies that will come into effect once the new administration is in place .

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As an aside, CE forecast EUR/USD to parity and USD/CNY to 8 by the end of 2025 under the new admin policies.

This article was written by Eamonn Sheridan at www.forexlive.com.

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The US stock day is ending mixed to start the new trading week. Dow industrial average

• Dow industrial average fell -55.39 points or -0.13% at 43389.60.
• S&P index rose 23.00 points or 0.39% and 5893.62.
• NASDAQ index rose 111.69 points or 0.60% and 18791.81
• Russell 2000 rose 2.505 points or 0.11% at 2306.34

Shares of Nvidia fell -1.29% in trading today on reports it’s Blackwell chip tended to overheat. Nvidia earnings will be released on Wednesday after the close.

Other magnificent 7 shares so Amazon shares are -0.45%, but Tesla shares up 5.62%. Alphabet rose 1.63% and Apple rose 1.34%. Meta-was near unchanged.

This article was written by Greg Michalowski at www.forexlive.com.

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