Why FX Volatility Will Dominate Markets In 2025 | Brent Donnelly

Why FX Volatility Will Dominate Markets In 2025 | Brent Donnelly – Forward Guidance

Market views

Bullish

USDRESERVE— The US dollar is expected to maintain its dominance as the global reserve currency for the long term.
USD— The current economic situation is compared to the 1990s, suggesting a bullish outlook for the US dollar.
FXVOL— FX volatility remains high compared to other asset classes, potentially due to its role as a release valve for tariffs.
USDCNH— China's approach to currency management prioritizes stability over economic management, suggesting potential for USDCNH appreciation.
USDJPY— Potential for carry trades to restart if the Bank of Japan signals neutral rates, which would be bullish for USDJPY.

Bearish

CAD— Bearish outlook on the Canadian dollar due to high consumer debt and unsustainable debt service ratios, although the target has been reached.

Not investment advice.