Goldman Sachs Forecasts Yen at ¥165, US Banks Rally Before Q2 Earnings
GS•Goldman Sachs strategists forecast the Japanese yen to weaken to ¥165 per dollar within a year, citing widening interest-rate differentials. Meanwhile, US bank stocks rallied in early July as investors increased bullish positioning ahead of Q2 earnings season.
1. Yen to Weaken to ¥165 per Dollar
Goldman Sachs economists highlight a broad policy divergence between the Federal Reserve and the Bank of Japan as the primary catalyst for the yen’s slide to 165 per dollar within the next 12 months. The forecast reflects expectations of further Fed rate hikes alongside Japan’s continued easing measures, which could boost GS’s FX trading and advisory revenue.
2. Bank Stocks Rally Ahead of Q2 Earnings
Major US bank shares climbed in early July, driven by optimistic investor sentiment around Q2 results and strong sector fundamentals. Rising net interest margin forecasts and robust loan growth projections have underpinned the pre-earnings bullishness, suggesting potential upside in trading and underwriting divisions at Goldman Sachs.
