Goldman Runs Risk Analysis On Potential European Shocks

In running risk-weighted analysis of potential impact of exogenous changes in six key variables driving the European economy, a Goldman Sachs report notes that the trade-weighted exchange rate, oil price and short-term interest rate changes have, to varying degrees, more impact on expected growth in the region than do changes to fiscal policy and global equity prices.

Goldman: Lower oil and Euro currency boosting regional economic prospects

The September 3 report, titled “Shocking European output,” notes potential positive impact at present. As oil prices have fallen by nearly half and the Euro has weakened by nearly 10 percent, Goldman’s estimates point to these two developments boosting...