Morgan Stanley foresees a smaller rise in the dollar in the event of a 20 percent border-adjustment tax, rather than a one-time 25 percent appreciation of the dollar, as implied by textbook theory. “We think a 10-15 percent rise in USD is reasonable,” Castagno and his team wrote. “Even if we don’t get a full exchange rate offset, the policy will still have a large impact on U.S. competitiveness and, therefore, the dollar.”
Source: Trump’s Border Tax Threat May Weaponize the Dollar – Bloomberg