Bloomberg Surveillance Bloomberg Surveillance TV: January 24, 2025
Jan 24, 2025
Experts share insights on the economic landscape amid a second Trump term. They analyze the notable shifts in currency markets, focusing on the yen and the resilient yuan. Discussion highlights record stock highs linked to regulatory changes. The podcast also delves into trade dynamics with China and Saudi Arabia, addressing the complexities of newly initiated tariffs. Additionally, there’s a look at the growing trend of de-dollarization by foreign banks and the implications for U.S. assets.
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BOJ's Hawkish Stance
- The Bank of Japan (BOJ) raised its inflation forecast, suggesting potential further hikes.
- The Yen's reaction was muted, despite the BOJ's hawkish stance and the strengthening of the Chinese Yuan.
FX Volatility Post-Inauguration
- The FX market has been the most volatile asset class in response to Trump's inauguration.
- This is due to the unwinding of risk premium built up in anticipation of potential trade disruptions.
Market Drivers in Trump's Second Term
- The most significant factor for the market is the absence of tax increases.
- Lower taxes and deregulation are also anticipated to be positive for the market.