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The euro could reach parity with the dollar by January 2017 — and it could fall as low as 90 cents by January 2018, Goldman Sachs said Friday in a research note.
Goldman GS, -1.53% revised its forecasts for several currency pairs to reflect what it predicts will be a prolonged period of dollar strength DXY, +0.44% as the U.S. economy continues to show strong growth ahead of imminent interest-rate increases by the Federal Reserve.
The euro EURUSD, -0.22% is likely to continue to fall relative to the dollar
The bank also lowered its year-end 2015 forecast for the euro’s value relative to the pound EURGBP, +0.14% to £0.73, from its previous forecast of £0.75. It left its year-end 2016 and year-end 2017 forecasts unchanged at £0.70 and £0.65 pounds.
The dollar has strengthened significantly against nearly every currency in the world in 2014. In fact, the dollar gained about 12.5% compared with a basket of currencies DXY, +0.47% last year, and has already added about 2% in 2015.
February gasoline RBG5, -1.52% gave up a penny, or 0.4%, to $1.32 a gallon, while February heating oil HOG5, -0.99% was down less than a cent at $1.70 a gallon for a 0.2% loss.
February natural gas NGG15, -1.26% pulled lower by 4 cents, or 1.2%, to $2.91 per million British thermal units.
The drumbeat of losses for crude-oil futures resumed with the open of electronic trade early Monday, as various analysts sounded pessimistic notes about the commodity’s outlook.
In Globex action during late Asian trading hours, West Texas Intermediate crude oil for February CLG5, -2.38% was down 83 cents, or 1.7%, at $47.53 a barrel. The move followed a 0.9% loss during Friday‘s regular session on the New York Mercantile Exchange.
INTERNATIONAL COMMODITY NEWS :
Gold price gained slightly in early Asia on Monday in a light regional data day and the focus on the dollar.On the Comex division of the New York Mercantile Exchange, gold futures for February delivery trade at $1,223.80 a troy ounce, up 0.04%.The US dollar index, which measures the dollar against a basked of six major currencies, fell 0.22% to 91.98.Last week, gold rallied to the highest level in almost four weeks on Friday, after the latest U.S. jobs report showed a surprise drop in hourly wages, suggesting that the Federal Reserve could keep rates on hold for longer.The Labor Department reported that the U.S. economy added 252,000 jobs in December, above expectations for jobs growth of 240,000. The unemployment rate ticked down to a six-and-a-half year low 5.6% from 5.8% in November. Economists had forecast a decline to 5.7%.
TRADING STRATEGY :
BUY GOLD ABOVE 1230 TARGET 1235 1241 SL 1224
SELL GOLD BELOW 1221 TARGET 1216 1210 SL 1227
