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South China Morning Post
19-05-2025
- Business
- South China Morning Post
Stronger Asian currencies a mixed blessing for region's property markets
When US President Donald Trump announced now-suspended swingeing 'reciprocal' tariffs on nearly all America's trading partners on April 2, Asian economies – which account for seven of the 10 economies with the largest bilateral trade surpluses with the United States – were singled out for punishment. To some currency analysts, Trump's tariff blitz added to the strain on the region's currencies, which had caused the Bloomberg Asia Dollar Index – a gauge of the performance of leading Asian currencies against the US dollar – to fall to a 19-year low in early January. Yet shortly after Trump unveiled his tariffs, Asian currencies began to appreciate in one of the most unexpected developments in markets since the onslaught of protectionism began. Bloomberg's Asian currency index is up over 3 per cent since April 9 despite numerous climbdowns on trade by Trump. The combination of the drop in the US dollar due to concerns about its safe-haven status , Asian companies' sudden unwinding of some of their unhedged holdings of dollar assets, and speculation that Asian governments will allow their currencies to appreciate to avoid punitive tariffs, has reversed a long period of currency weakness in the region. This could be a foretaste of things to come. In a report on May 6, Eurizon SLJ Capital said US dollar 'hoardings by Asian exporters and institutional investors may be extremely large – possibly in the order of US$2.5 trillion or so – and pose sharp downside risks to the dollar vis-a-vis [several] Asian currencies. This is the 'avalanche risk' we have been warning about since late 2022.'
Forbes
10-05-2025
- Business
- Forbes
Crypto Suddenly Braced For A Huge China Earthquake As $1 Million Bitcoin Price Predicted To Flip Gold
05/10 update below. This post was originally published on May 9 Bitcoin and crypto prices have rocketed higher this week as a perfect storm gathers for risk assets. Front-run Donald Trump, the White House and Wall Street by subscribing now to Forbes' CryptoAsset & Blockchain Advisor where you can "uncover blockchain blockbusters poised for 1,000% plus gains!" The bitcoin price has smashed $100,000 per bitcoin for the first time since February, with traders surprised by U.S. president Donald Trump's crypto czar David Sacks issuing a rare bitcoin price prediction. Now, as traders brace for a $10 trillion Wall Street game-changer, Federal Reserve chair Jerome Powell has been warned a $2.5 trillion 'avalanche' is suddenly heading for the U.S. dollar that could help the bitcoin price rocket toward gold's $20 trillion market capitalization. Sign up now for the free CryptoCodex—A daily five-minute newsletter for traders, investors and the crypto-curious that will get you up to date and keep you ahead of the bitcoin and crypto market bull run Federal Reserve chair Jerome Powell has been warned a $2.5 trillion 'avalanche" is heading toward ... More the U.S. dollar as the bitcoin price soars over $100,000. "We continue to believe the risks of investors being blind-sided by such a non-linear sell-off in the dollar continue to rise," Stephen Jen, chief executive and co-chief investment officer of Eurizon SLJ Capital, and economist Joana Freire warned in a note seen by MarketWatch and pointing to the recent sudden spike in the value of the Taiwan dollar and other Asian currencies that they warn could be a prelude to a dollar sell-off. 'There will be others, we predict,' the pair wrote, adding, 'the overhang of liquid dollar holdings is just too large if the dollar weakens, the Fed cuts interest rates, and China stages a cyclical rebound.' The Fed, which left rates on hold this week, is widely expected to begin cutting interest rates this summer after putting the loosening cycle begun in September on hold, with expectations growing for cuts totaling 75 basis points in 2025. 05/10 update: The bitcoin and crypto market is closely watching the beginning of U.S. China trade talks after U.S. president Donald Trump signaled the U.S. may be open to lowering the massive tariffs that the U.S. slapped on China at the beginning of April, causing the bitcoin price to sharply fall along with wider crypto and stocks markets. "80% tariff on China seems right," Trump posted to his Truth Social account, adding it's 'up to' Treasury secretary Scott Bessent who will be in Geneva, Switzerland for the talks. "After carefully assessing the U.S. messages, China decided to agree to hold discussions," a spokesperson for the Embassy of the People's Republic of China in the U.S. said this week. 'The talks are being held at the request of the U.S. side.' The bitcoin price has surged past $100,000 per bitcoin this week, breaking back above the closely-watched level for the first time since February. 'The market should be on alert that if neither side shows willingness to compromise, it could dampen the current risk-on mood and weigh on the bitcoin market heading into the weekend,' Yuya Hasegawa, crypto market analyst at Tokyo-based Bitbank, said via email. 'Sentiment got an additional lift from the prospect of this weekend's trade talks between the U.S. and China,' David Morrison, senior market analyst at Trade Nation, said in emailed comments. 'While it is understood that these are preliminary discussions, investors are hoping that these negotiations will prove constructive, and lead to a timely resumption in bilateral trade.' However, Morrison added, 'there's a lot of good news already priced in. It's also the case that it takes time to reach trade agreements, and significant damage has already been done to global trade, with relations between the U.S. and China both frosty and uncertain. In other words, it wouldn't take much of a disappointment for investors to start reducing their exposure to equities.' U.S. trading partners could start dumping the massive stores of dollars and dollar-denominated assets they have accumulated since the Fed flooded the market through Covid-era lockdowns, the analysts warned, putting the number of at-risk dollars held by China, Taiwan, Malaysia, Vietnam and other major Asian exporters at $2.5 trillion. Meanwhile, some think a sell-off of the dollar and U.S. assets would flow into bitcoin, which has rebounded back to near its all-time price of almost $110,000 through May. 'The dominant story for bitcoin has changed again,' Standard Chartered Bank's head of crypto research Geoff Kendrick wrote in an emailed note. Sign up now for CryptoCodex—A free, daily newsletter for the crypto-curious The bitcoin price has rocketed back to near its all-time high of close to $110,000 per bitcoin after ... More falling sharply along with other assets since February. 'It was correlation to risk assets. It then became a way to position for strategic asset reallocation out of U.S. assets. It is now all about flows. And flows are coming in many forms,' Kendrick wrote, pointing to bitcoin spot exchange-traded funds (ETFs) inflows, U.S. states that are passing laws allowing their treasuries to hold bitcoin and sovereign wealth fund and pension funds tiptoeing into bitcoin. 'I apologise that my $120,000 second quarter target may be too low,' Kendrick added. Other bitcoin price bulls are even more upbeat, with Miller Value Partners chief investment officer and chairman, Bill Miller IV, telling CNBC the bitcoin price will keep climbing until it eclipses gold's $20 trillion market capitalization. 'Bitcoin's back in the six-figures with a lot of room to go. If you compare its primary functional use case, a check and a balance on the lack of accountability in fiat unit creation, we still have a long way to go,' Miller said, predicting bitcoin's 'functional superiority' will push it to a price of $1 million per bitcoin.
Economic Times
09-05-2025
- Business
- Economic Times
Market veteran warns of impending currency avalanche with U.S. Dollar at risk after a week of global financial shockwaves
A market expert warns of a possible dollar crash. Stephen Jen, Eurizon SLJ Capital CEO, predicts a dollar 'avalanche'. Asian currencies' surge signals a wider dollar sell-off. Geopolitical trends and interest rates may trigger US trading partners to dump dollar assets. China and Taiwan hold $2.5 trillion in at-risk dollar assets. Tired of too many ads? Remove Ads Dollar "Avalanche" Tired of too many ads? Remove Ads Dollar Index Dips Sharply in 2025 FAQs A market veteran is sounding dire warnings about the US dollar's susceptibility after a week of dramatic swings in the world's currency markets, as per a Jen, Eurizon SLJ Capital CEO and co-CIO, has long been issuing warnings about the threat of an abrupt and disorderly weakening of the dollar, which he compared to an "avalanche," as per a Market Watch worst nightmare seems to be coming true. In a recent report, Jen and co-author Joana Freire noted the dramatic surge in the Taiwan dollar and other Asian currencies as one of the potential indicators of a wider sell-off in the dollar, according to Market wrote 'We continue to believe the risks of investors being blind-sided by such a non-linear sell-off in the dollar continue to rise. The sharp sell-off in [the Taiwan dollar] last week is such an example. There will be others, we predict,' quoted Market and Freire also pointed out that the changing geopolitical trends and interest-rate spreads may lead US trading partners to start dumping the huge stockpiles of dollar and dollar-denominated assets they have amassed since the onset of the COVID-19 pandemic, reported Market to their calculations, the amount of at-risk dollars held by China, Taiwan, Malaysia, Vietnam and other major Asian exporters is about $2.5 trillion, a tally that has recently been rising by about $500 billion a year, reported Market worry is aggravated by the fact that the dollar has been overvalued for a while now, and Jen cautions that if the dollar keeps depreciating, foreign US asset holders can liquidate and withdraw their funds, as per the report. From the start of this year, the US Dollar Index, which monitors the value of the dollar relative to a basket of major currencies, has already dropped over 8%, touching a three-year low, reported Market estimated that countries like China and Taiwan hold about $2.5 trillion in potentially at-risk US dollar US Dollar Index is down more than 8% this year and hit a three-year low recently.
Time of India
08-05-2025
- Business
- Time of India
Market veteran warns of impending currency avalanche with U.S. Dollar at risk after a week of global financial shockwaves
A market veteran is sounding dire warnings about the US dollar's susceptibility after a week of dramatic swings in the world's currency markets, as per a report. Dollar "Avalanche" Stephen Jen, Eurizon SLJ Capital CEO and co-CIO, has long been issuing warnings about the threat of an abrupt and disorderly weakening of the dollar, which he compared to an "avalanche," as per a Market Watch report. #Operation Sindoor Live Updates| From Sindoor to showdown? Track Indo-Pak conflict as it unfolds India hits Lahore's Air Defence Radars in proportionate response Pakistan tried to hit military targets in these 15 Indian cities, New Delhi thwarts strikes Jen's worst nightmare seems to be coming true. In a recent report, Jen and co-author Joana Freire noted the dramatic surge in the Taiwan dollar and other Asian currencies as one of the potential indicators of a wider sell-off in the dollar, according to Market Watch. Continue to video 5 5 Next Stay Playback speed 1x Normal Back 0.25x 0.5x 1x Normal 1.5x 2x 5 5 / Skip Ads by by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Belly Fat Removal Without Surgery in Algeria: The Price Might Surprise You Belly Fat Removal | Search Ads Get Info They wrote 'We continue to believe the risks of investors being blind-sided by such a non-linear sell-off in the dollar continue to rise. The sharp sell-off in [the Taiwan dollar] last week is such an example. There will be others, we predict,' quoted Market Watch. Jen and Freire also pointed out that the changing geopolitical trends and interest-rate spreads may lead US trading partners to start dumping the huge stockpiles of dollar and dollar-denominated assets they have amassed since the onset of the COVID-19 pandemic, reported Market Watch. Live Events According to their calculations, the amount of at-risk dollars held by China, Taiwan, Malaysia, Vietnam and other major Asian exporters is about $2.5 trillion, a tally that has recently been rising by about $500 billion a year, reported Market Watch. Dollar Index Dips Sharply in 2025 The worry is aggravated by the fact that the dollar has been overvalued for a while now, and Jen cautions that if the dollar keeps depreciating, foreign US asset holders can liquidate and withdraw their funds, as per the report. From the start of this year, the US Dollar Index, which monitors the value of the dollar relative to a basket of major currencies, has already dropped over 8%, touching a three-year low, reported Market Watch. FAQs How much dollar risk is out there globally? Experts estimated that countries like China and Taiwan hold about $2.5 trillion in potentially at-risk US dollar assets. How is the dollar performing right now? The US Dollar Index is down more than 8% this year and hit a three-year low recently.
Yahoo
08-05-2025
- Business
- Yahoo
A currency-market ‘avalanche' is heading for the U.S. dollar, and the tremors started this week
Investors have valid reasons to be concerned about wild swings in the global currency market over the past few days, according to one market veteran. Since late 2022, Stephen Jen, chief executive and co-chief investment officer of Eurizon SLJ Capital, has been warning about the possibility that the U.S. dollar could be vulnerable to a sudden, disorderly depreciation, which he has likened to an 'avalanche.' My second wife says her 2 kids should inherit our estate, but I also have 2 kids. Is that fair? I'm 65 and a widow with 5 children. Should I give them my $1.1 million investment account while I'm still alive? Suze Orman says retirees should have a 5-year 'just-in-case' fund. Is this true? My father is giving me $250K to buy a home, but told me not to tell my two siblings. Am I morally obligated to tell them? My eldest son refused to share his father's $500K inheritance with his siblings. Should I cut him off? Jen thinks that moment may have finally arrived. In a report shared with MarketWatch on Wednesday, Jen and co-author Joana Freire said that the sudden spike in the value of the Taiwan dollar and other Asian currencies could be a prelude to a bigger selloff in the greenback. 'We continue to believe the risks of investors being blind-sided by such a non-linear sell-off in the dollar continue to rise. The sharp sell-off in [the Taiwan dollar] last week is such an example. There will be others, we predict,' they said in the report. In the view of Jen and Freire, changes in the geopolitical landscape, interest-rate spreads or other factors could inspire U.S. trading partners to start dumping the massive stores of dollars and dollar-denominated assets they have accumulated since the COVID-19 pandemic began in 2020. They calculated that the pile of at-risk dollars held by China, Taiwan, Malaysia, Vietnam and other major Asian exporters has topped $2.5 trillion, a tally that has recently been rising by about $500 billion a year. Some of this money has been parked in liquid money-market instruments that aren't included in data on international investment flows, Jen said. The chart below shows the cumulative trade surpluses that major Asian exporters have accumulated with the U.S. since the start of 2020. It shows that the biggest 'avalanche' risk for the dollar stems from Malaysia, Taiwan, Singapore, China and Vietnam. If local exporters were to unload even a portion of their dollar holdings, it could cause the buck to weaken substantially. The risk is compounded by the fact that these market participants know the dollar is overvalued, Jen said, which could encourage them to cut and run if the greenback continues to weaken. 'The overhang of liquid dollar holdings is just too large if the dollar weakens, the Fed cuts interest rates, and China stages a cyclical rebound,' Jen and Freire said. The Federal Reserve wasn't expected to cut rates on Wednesday at the conclusion of its two-day policy meeting, but expectations have been growing for cuts totaling 75 basis points in 2025. Another concern has been that President Donald Trump's trade agenda could inspire foreign authorities to hold fewer dollars in reserve. Yet global dollar reserves held by foreign central banks have been falling for years, and investors have seen few signs so far that foreign investors have moved to meaningfully reduce their holdings of U.S. bonds. Right now the biggest vulnerability, in Jen's view, is China. Since the start of 2024, the People's Bank of China has been closely managing the yuan, helping to keep its value against the dollar stable even as the greenback has weakened against most rivals. The ICE U.S. Dollar Index DXY, a gauge of the dollar's value relative to major rivals like the euro, has fallen by more than 8% since the start of the year. The index was recently trading at 99.45, just above a three-year low reached last month. Jen and Freire fear that a resumption of interest-rate cuts by the Fed, or an accusation of currency manipulation by the Treasury Department, could prompt Beijing to allow the yuan to appreciate. During the first Trump administration, Washington briefly labeled Beijing a currency manipulator before formally removing the designation in 2020. This could be the trigger that finally sets the avalanche in motion. But as with an actual avalanche, predicting exactly what might set off the move would be extremely difficult. For now, Jen and his team said they can only watch and wait. Jen previously ran currency research at Morgan Stanley, where he popularized the 'dollar smile' theory. The theory argues that the greenback tends to appreciate when the U.S. economy is booming or when the global economy is struggling. During the two days through Monday, the U.S. dollar weakened by more than 9% against the Taiwan dollar USDTWD. According to Dow Jones Market Data, this was the largest move on record for the currency pair going back to at least 2007. Other Asian currencies, like the South Korean won USDKRW, also surged, although those moves weren't quite as dramatic. Things were quieting down Wednesday, as the Taiwan dollar and other currencies eased off their highs. Still, their rapid and unexpected surge has revived speculation about whether foreign investors might be dumping dollar-denominated assets. Not everybody has been as concerned as Jen and Freire. A team of analysts at Barclays said the move in the Taiwan dollar was likely already overdone and recommended that clients fade it. The analysts pushed back against the notion that dollar weakness could force Taiwanese life-insurance firms to dump their U.S. dollar-denominated holdings. 'Forced unwinds are unlikely, in our view, as lifers will look to avoid the realisation of losses — similar to 2022, when rises in U.S. interest rates had weighed on their USD bond investments,' the Barclays team said. Of course, back then, the dollar was strengthening as U.S. interest rates shot higher, helping offset some of these investors' portfolio losses in local-currency terms. Treasury yields jumped on Friday, but one economist told MarketWatch that the selloff in the bond market likely had more to do with the strong April jobs report than any selling by Taiwanese investors. Bond yields rise as bond prices fall. Analysts at Deutsche Bank appear to have uncovered some signs of selling. A new tracker developed by the team found that Taiwan ETFs dumped U.S. fixed-income assets on Monday. My husband and I have $3M and are blessed with 3 children. Are we obliged to give them each $50K for their education? 'We live modestly': My wife and I have $900K in stocks and $380K in savings and CDs. Are we holding too much cash? Beware, investors: The recent stock rally is based on an unknown outcome after Trump's 90-day tariff pause This zero-day options craze could finally be coming to popular stocks like Nvidia and Tesla. Here's what to know. How investors should think about Berkshire's stock price without Buffett Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
