Goldman Sachs: Tactical USD shorts surge but structural flows likely to take time ...Middle East

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Goldman Sachs: Tactical USD shorts surge but structural flows likely to take time
Goldman Sachs highlights a dramatic shift in market sentiment towards USD shorts as positioning adjusts ahead of anticipated Fed rate cuts. Despite tactical shifts, structural flows and high attractiveness of US assets may limit the USD’s decline.Key Points:Positioning Shift: Significant USD shorts have emerged, reflecting a market sentiment leaning towards USD weakness. This shift follows a move lower in the USD driven by the unwinding of long positions.Historical Context: Historically, USD shorts often increase before the start of a cutting cycle. Despite this, Goldman Sachs sees parallels to the market's reaction to dovish Fed communications from December 2023.Structural Flows: While tact

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