The depreciation of the US dollar has drawn significant attention in recent months, particularly due to forecasts by Goldman Sachs predicting an accelerated downward trend. This development potentially has significant ramifications for the stock markets and is highly relevant for investors in the German-speaking region.
Background of the Dollar Depreciation
The US dollar has lost about 7.5% of its value since the beginning of 2025, which can be attributed to several factors. The main reasons include the trade policy of the USA, the resilience of the economy, and increasing concerns about the global economic situation. Analysts from major banks like Goldman Sachs and Deutsche Bank are warning of a prolonged downward trend for the dollar.
Forecasts and Impacts
Goldman Sachs Forecast
Goldman Sachs emphasizes that the dollar is historically overvalued when adjusted for inflation. Comparable phases in the past, such as in the 1980s and early 2000s, ended with a depreciation of 25-30%. This forecast suggests that the dollar could continue to lose value, which could impact the stock markets.
Impact on Stock Markets
The depreciation of the US dollar can have both positive and negative effects on the stock markets:
- Positive Effects: A weaker currency can help US exports as American products become cheaper abroad. This could lead to higher profits for export-oriented companies.
- Negative Effects: A devaluation of the dollar can also lead to higher import costs, which could increase inflation and reduce the profits of companies that heavily rely on imports.
Relevance for the German-speaking Region
For investors in the German-speaking region, the dollar’s depreciation is particularly relevant, as it affects the exchange rate between the euro and the dollar. A stronger euro could burden the export economy in Germany and other European countries, as European products become more expensive abroad. On the other hand, a stronger eurozone might also lead to increased investments in European stocks, as the euro is perceived as a stable currency.
Exchange Rate Forecasts
Forecasts for the EUR/USD exchange rate are mixed. Some experts expect parity or even an appreciation of the euro by the end of 2025. Other forecasts, such as those from Deutsche Bank, anticipate that the euro could rise to 1.30 USD by the end of 2027.
Overall, the depreciation of the US dollar is a complex issue with far-reaching effects on global markets. Investors should prepare for these developments and adjust their investment strategies accordingly.