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Thomas Harr from Danske Bank anticipates the Japanese yen (JPY) remain the top performers due to the central bank’s reluctance to ease monetary policy and lower equities, citing trade-war fears.

Key quotes

  • Trump’s actions on Friday mark a significant escalation of the trade war.
  • Friday’s events raise the risk of an all-out economic war between the US and China.
  • Equities are set to fall and volatility to rise as the manufacturing/capex slowdown worsens and uncertainty increases.
  • Friday’s events to trigger a new leg lower in core euro interest rates and a spike higher in volatility. JPY will continue to outperform.