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The return of Donald Trump to the White House was a boon in the Asian currency markets, as traders in the US and Europe respond to its late-night posts on social networks and announce by applying for the only open trade places.
The first few weeks of Trump’s second term were marked by statements on the outside of working hours in the US that were rolling markets and sending traders cheering to adapt their positions.
“It definitely creates a lot of demand and liquidity on the market,” said Beng Hong Lee, head of wholesale markets and platforms on the SGX, Singaporership Stock Exchange.
“Due to the unexpected risks of events-on the weekend and late-night posts on social media-you have London dealers who apply at 1am for Asia trade.”
The American dollar and offshore Chinese currency pair of Renminba, known as USD/CNH, appeared as the second most popular Futures Agreement that has been traded in recent months, after the dollar pairing with the euro.
The average daily volume in the USD/CNH, which is traded in Singapore, has reached $ 16 billion in the second half of 2024, which is more than 50 percent compared to the previous year.
Meanwhile, the average daily volume in pairing dollars with an Indian hole, which is also traded to SGX, increased by 46 percent to $ 1.9 billion in the same period.
From his choice in November, Trump He made a series of announcements of politics and turns, often late into the night or on weekends.
They include a threat to impose tariff Colombia for blocking flights of deportation into the ground, which was withdrawn on Sunday after its inauguration hours later.
Next Friday, the White House set plans for heavy tariffs in Canada, Mexico and China, which responded all on weekends by retribution. By Monday, they have now withdrawn from their threats to Canada and Mexico, while the views on China entered into force on February 10th.
On Sunday, February 9, while he was on his way to watch Super Bowl, Trump told reporters at the Air Force that he would to impose 25 percent of tariffs On all the imports of steel and aluminum, affecting shares in some European and Asian manufacturers.
The events that move on the market have encouraged the merchants to try to answer as quickly as possible, said Alexander von Zur Mühlen, head of Asian-Pacific, Europe, the Middle East and Africa, as well as Germany, in Deutsche Bank.
“European investors and corporate customers are looking to protect themselves in Asia throughout the night because they know that if not waking up in the morning, it could be too late and music may have stopped,” he added.
Global motto The market is open 24 hours a day throughout the week, as four main trade sessions in Sydney, Tokyo, London and New York overlap.
“Average daily quantities for most of the main FX currencies have increased quite significantly after the inauguration,” said Nathan Swami, head of foreign exchange stores in Citigroup.
He added that there was a significant increase in the use of USD/CNH of the contracts to bet on future moves in currency and protect himself from the fluctuation of the course.
Analysts from the Bank of America warned clients on Tuesday that uncertainty about US trade policies would continue to strive for Asian currency with regard to trade surpluses, which many Asian countries had with the USA.
“[Being] Dugi USD/CNH is still the best medium -term protection in our opinion, especially since the tariff rates are more likely to be permanent than elsewhere, “said Adarsh Sinha, a strategist of Deviz and the rates at the Bank of America Securities.
