Goldman’s rates trading desk loss drags earnings
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Goldman Sachs Group Inc's rates-trading business took a hit due to surging interest rates, causing the bank's fixed income, currencies, and commodities unit to miss analyst expectations. The bank's stock traders, however, posted a record-breaking $5.33 billion for the quarter.
Goldman Sachs Group Inc's vast rates-trading business took a hit as interest rates surged following US and Israel's attacks on Iran. The bank's fixed income, currencies, and commodities unit posted a $4 billion revenue, 10% lower than the same period last year and below analyst estimates. Losses from the US nonlinear gamma rates desk were a significant factor. The bank's stock traders, however, posted a record $5.33 billion for the quarter. CEO David Solomon defended the fixed income trading division, criticizing analysts for setting the bar too high. Goldman's relatively large rates desk made it more vulnerable to geopolitical shocks compared to peers like JPMorgan Chase & Co.
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