Currency Shake-up Rattles Fashion World

LONDON — The plummeting euro and the pumped-up dollar have made for one strong cocktail of pleasure — and pain — for businesses and consumers on both sides of the Atlantic. The new currency normal has left European companies rejoicing about cheaper exports, fatter bottom lines and the potential to expand in the U.S. market, even as their anxieties grow about global pricing, the gray market and sourcing. American firms, used to operating with a weak currency, are now feeling the sting of falling sales and expensive exports while U.S. tourists, who suffered for years with a feeble currency, are preparing to press their plastic into action on the Continent and in the U.K., where the pound has lost substantial ground against the dollar. Back in January, Morgan Stanley predicted the euro would reach parity with the dollar by 2016, but earlier this month Goldman Sachs went even further and said parity could now happen as early as September. The last time the euro and the dollar were matched in value was more than a decade ago, in late 2002. Goldman’s latest three-month forecast for the euro is $1.02, and its 12-month projection is 95 cents. By the end of 2017, the bank expects the

Follow WWD on Twitter or become a fan on Facebook.

Read More...