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Global Markets Brace for Volatility Amid Tariff Turbulence
Feb 6, 2025

Global Markets Brace for Volatility Amid Tariff Turbulence

In a week marked by global financial-market turbulence initiated by a series of US tariff announcements, traders are gearing up for what JPMorgan Chase & Co. predicts will be a volatile year. According to a Bloomberg report that can be read here, the bank's electronic trading survey identifies inflation and tariffs as the leading factors set to impact markets in 2025, followed by geopolitical tensions.

The annual trading poll witnessed an increase in the number of traders, now 41%, highlighting volatility as their primary daily trading challenge, an escalation from 28% the previous year. What sets this year apart is the somewhat unexpected timing of volatility, said Eddie Wen, JPMorgan's global head of digital markets. Markets are reacting to news headlines in surprising ways, and I expect this trend to continue in the current climate.

Traders express concern over the unclear impacts of tariffs across different asset classes. The survey, conducted with over 4,200 institutional traders last month, preceded substantial market disruptions caused by President Donald Trump's trade levies. These disruptions have particularly influenced the trading of currencies like the Canadian dollar, Mexican peso, and the offshore Chinese yuan, according to Chi Nzelu, JPMorgan's global head of FICC e-trading.

Monday saw the Mexican peso drop nearly 3% before regaining to end the session 1.5% higher. Similarly, the Canadian dollar experienced a 1.7% dip before reversing to close 0.8% higher. The US dollar also made gains against most major currencies, marking a period of active execution from hedge funds to retail markets, explained Nzelu. He noted that these are really large moves for major currencies that sparked a lot of execution, while highlighting that trading volume increases are not limited to hedge funds.

The anticipation that higher import prices might reignite inflationary pressures persists, diminishing prospects of the Federal Reserve significantly reducing interest rates this year. A proposed 25% tariff on Canadian and Mexican goods was suspended, pending commitments from these countries to address illegal migration and drug trafficking concerns. However, a 10% tariff on Chinese imports has been enforced, with the possibility of a pause remaining open.

Electronic trading continues to become integral, with all surveyed respondents indicating plans to increase their activity in this sector. This aligns with a broader shift towards digital platforms across asset classes. Nzelu emphasized the importance of electronic trading, saying, Tariff announcements can occur over the weekend, prompting clients to seek liquidity to rebalance their portfolios at the start of the session.

On trading platforms, 28% of traders prefer single-dealer venues, 38% opt for multi-dealer, while 34% use both. Reduced execution costs are crucial for single-dealer platform users, whereas avoiding information leakage is important for crypto and cash equity traders. Despite cryptocurrencies reaching record highs, 71% of respondents have no plans to trade them. The White House, however, is exploring the feasibility of a "Bitcoin reserve," signaling a potential shift in the traditional banking community's engagement with digital assets.

Recent developments suggest the administration may support crypto markets, softening entry barriers for banks. Eddie Wen noted, The details are light at the moment, but we are keeping a close eye on how this develops.

Source: IndexBox Market Intelligence Platform

  1. 1. INTRODUCTION

    Making Data-Driven Decisions to Grow Your Business

    1. REPORT DESCRIPTION
    2. RESEARCH METHODOLOGY AND THE AI PLATFORM
    3. DATA-DRIVEN DECISIONS FOR YOUR BUSINESS
    4. GLOSSARY AND SPECIFIC TERMS

  2. 2. EXECUTIVE SUMMARY

    A Quick Overview of Market Performance

    1. KEY FINDINGS
    2. MARKET TRENDSThis Chapter is Available Only for the Professional EditionPRO

  3. 3. MARKET OVERVIEW

    Understanding the Current State of The Market and its Prospects

    1. MARKET SIZE: HISTORICAL DATA (2012–2024) AND FORECAST (2025–2035)
    2. MARKET STRUCTURE: HISTORICAL DATA (2012–2024) AND FORECAST (2025–2035)
    3. TRADE BALANCE: HISTORICAL DATA (2012–2024) AND FORECAST (2025–2035)
    4. PER CAPITA CONSUMPTION: HISTORICAL DATA (2012–2024) AND FORECAST (2025–2035)
    5. MARKET FORECAST TO 2035

  4. 4. MOST PROMISING PRODUCTS FOR DIVERSIFICATION

    Finding New Products to Diversify Your Business

    1. TOP PRODUCTS TO DIVERSIFY YOUR BUSINESS
    2. BEST-SELLING PRODUCTS
    3. MOST CONSUMED PRODUCTS
    4. MOST TRADED PRODUCTS
    5. MOST PROFITABLE PRODUCTS FOR EXPORTS

  5. 5. MOST PROMISING SUPPLYING COUNTRIES

    Choosing the Best Countries to Establish Your Sustainable Supply Chain

    1. TOP COUNTRIES TO SOURCE YOUR PRODUCT
    2. TOP PRODUCING COUNTRIES
    3. TOP EXPORTING COUNTRIES
    4. LOW-COST EXPORTING COUNTRIES

  6. 6. MOST PROMISING OVERSEAS MARKETS

    Choosing the Best Countries to Boost Your Export

    1. TOP OVERSEAS MARKETS FOR EXPORTING YOUR PRODUCT
    2. TOP CONSUMING MARKETS
    3. UNSATURATED MARKETS
    4. TOP IMPORTING MARKETS
    5. MOST PROFITABLE MARKETS

  7. 7. PRODUCTION

    The Latest Trends and Insights into The Industry

    1. PRODUCTION VOLUME AND VALUE: HISTORICAL DATA (2012–2024) AND FORECAST (2025–2035)

  8. 8. IMPORTS

    The Largest Import Supplying Countries

    1. IMPORTS: HISTORICAL DATA (2012–2024) AND FORECAST (2025–2035)
    2. IMPORTS BY COUNTRY: HISTORICAL DATA (2012–2024)
    3. IMPORT PRICES BY COUNTRY: HISTORICAL DATA (2012–2024)

  9. 9. EXPORTS

    The Largest Destinations for Exports

    1. EXPORTS: HISTORICAL DATA (2012–2024) AND FORECAST (2025–2035)
    2. EXPORTS BY COUNTRY: HISTORICAL DATA (2012–2024)
    3. EXPORT PRICES BY COUNTRY: HISTORICAL DATA (2012–2024)

  10. 10. PROFILES OF MAJOR PRODUCERS

    The Largest Producers on The Market and Their Profiles

  11. LIST OF TABLES

    1. Key Findings In 2024
    2. Market Volume, In Physical Terms: Historical Data (2012–2024) and Forecast (2025–2035)
    3. Market Value: Historical Data (2012–2024) and Forecast (2025–2035)
    4. Per Capita Consumption: Historical Data (2012–2024) and Forecast (2025–2035)
    5. Imports, In Physical Terms, By Country, 2012–2024
    6. Imports, In Value Terms, By Country, 2012–2024
    7. Import Prices, By Country, 2012–2024
    8. Exports, In Physical Terms, By Country, 2012–2024
    9. Exports, In Value Terms, By Country, 2012–2024
    10. Export Prices, By Country, 2012–2024

  12. LIST OF FIGURES

    1. Market Volume, In Physical Terms: Historical Data (2012–2024) and Forecast (2025–2035)
    2. Market Value: Historical Data (2012–2024) and Forecast (2025–2035)
    3. Market Structure – Domestic Supply vs. Imports, in Physical Terms: Historical Data (2012–2024) and Forecast (2025–2035)
    4. Market Structure – Domestic Supply vs. Imports, in Value Terms: Historical Data (2012–2024) and Forecast (2025–2035)
    5. Trade Balance, In Physical Terms: Historical Data (2012–2024) and Forecast (2025–2035)
    6. Trade Balance, In Value Terms: Historical Data (2012–2024) and Forecast (2025–2035)
    7. Per Capita Consumption: Historical Data (2012–2024) and Forecast (2025–2035)
    8. Market Volume Forecast to 2035
    9. Market Value Forecast to 2035
    10. Market Size and Growth, By Product
    11. Average Per Capita Consumption, By Product
    12. Exports and Growth, By Product
    13. Export Prices and Growth, By Product
    14. Production Volume and Growth
    15. Exports and Growth
    16. Export Prices and Growth
    17. Market Size and Growth
    18. Per Capita Consumption
    19. Imports and Growth
    20. Import Prices
    21. Production, In Physical Terms: Historical Data (2012–2024) and Forecast (2025–2035)
    22. Production, In Value Terms: Historical Data (2012–2024) and Forecast (2025–2035)
    23. Imports, In Physical Terms: Historical Data (2012–2024) and Forecast (2025–2035)
    24. Imports, In Value Terms: Historical Data (2012–2024) and Forecast (2025–2035)
    25. Imports, In Physical Terms, By Country, 2024
    26. Imports, In Physical Terms, By Country, 2012–2024
    27. Imports, In Value Terms, By Country, 2012–2024
    28. Import Prices, By Country, 2012–2024
    29. Exports, In Physical Terms: Historical Data (2012–2024) and Forecast (2025–2035)
    30. Exports, In Value Terms: Historical Data (2012–2024) and Forecast (2025–2035)
    31. Exports, In Physical Terms, By Country, 2024
    32. Exports, In Physical Terms, By Country, 2012–2024
    33. Exports, In Value Terms, By Country, 2012–2024
    34. Export Prices, By Country, 2012–2024

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