The dollar will reach a new peak faster than expected. Serious analysis from Goldman Sachs

Goldman Sachs predicted that the dollar price against the world's major and national currencies could peak as much as it could rise sooner than expected.

A closer-than-expected peak of the dollar price
According to Business Insider, the US Federal Reserve's policies have led (Central Bank) This year's hardening contraction, in raising interest rates by 300 basis points in 5 phases so far, has led to a damaging dollar rate rise in the value of major global currencies such as the euro, the yen and the yuan, due to the interest of investors and dollar holders in depositing in U.S. banks and investing in U.S. debt instruments pending higher returns than offered on the rest of the world's currencies.

The site explained that Goldman Sachs has conducted a historical analysis of the dollar trend and concluded that the dollar had reached its highest level against other currencies in periods when the growth of the U.S. and global economy was at its lowest rate and in conjunction with the Federal Reserve's expansionary policies, The opposite is now where the growth rate is higher than what is needed to control inflation. Because of this, the US Federal Reserve is currently pursuing a stringent deflationary policy. In order to withdraw the money supply from the markets in the hope of curbing inflation.

But, according to Goldman Sachs' analysis, the major increases in the dollar price during the 1970s and "80s in particular are the most recent example of the current situation, coinciding with current high inflation rates, other than the course the dollar took in the other two decades when it was rising at times of low growth and low inflation.

Expectations to slow rate hikes by Fed
"Perhaps the experience of the mid-1970s and mid-1980s, when inflation was as high as it is now, should be considered," Goldman Sachs said in its analysis. This similar situation makes it clear that it may not be necessary to see the Fed relax its monetary policy tightening or see its inflation rate. It has declined to conclude that the dollar has reached the peak of the rally. The dollar could reach an early peak if the course of interest raises is only expected to be temporarily halted, even if U.S. economy growth continues to slow. "

Business Insider added that investors are somehow expecting the Federal Reserve to slow down its hardline deflationary policy and temporarily halt rate hikes, an expectation reinforced by San Francisco Fed Chairman Mary Daly's statement when she said "it's time to start talking about setting the pace for rate hikes."

Goldman Sachs' analysis concluded that the dollar could peak in 2023, earlier than expected in 2024.