Goldman Sachs says US-China trade war, not Fed, is driving dollar

Goldman sees the US Dollar Index, which fell by as much as 0.5% on Thursday, reaching 99.7 by December

The Trump administration’s trade war with China, along with a flight-to-quality in Treasuries, is having more of an impact on the dollar’s value than the Federal Reserve’s policy stance, according to Zach Pandl of Goldman Sachs Group Inc.

“The Fed is not the single biggest factor on the dollar, currently,” Pandl, the firm’s co-head of global FX and emerging-market strategy, said in a phone interview Thursday. Data shows portfolio outflows from almost every country, except the US., heading into bonds during August in a “classic flight-to-quality” that also lifted the dollar, he said.
 

President Donald Trump has railed against the impact