Arindam Sandilya, James Nelligan and Junya Tanase discuss the week in currencies. This podcast was recorded on 10 July 2026. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-5360103-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2026 JPMorgan Chase &amp; Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party.

Global FX: Keep calm and carry on

At Any Rate

Hello and welcome to this At Any Rate podcast. I'm your host Arindam Sandilya from J.P. Morgan's FX Strategy team and I'm joined today by my colleagues Junior Tanase and James Nelligan. We are, what, barely two weeks into the second half of the year, right? And one would expect this to be a relatively quiet period of basically World Cup football watching and not much else in markets, but that's not quite the case.

Markets were jolted this week by a sharp 8% spike in Brent when Iran and the U.S. military skirmishes flared up again. So far we, like most of the market, are treating this as a limited escalation within a fragile truce. And we view the incentives on both sides to return to March-April's full-blown war as quite low.

That said, we are reasonably confident in the ability of our current bullish carry and bullish U.S. dollar barbell construct to withstand even a more serious escalation in the Middle East as well. You know, given that our carry baskets are constructed with a smattering of high-yielding energy exporters on the asset side, and more importantly, energy importing low-yielders on the financing side, mostly in Western Europe and Asia.

And it's because of the latter in particular that FX carry a flatline, but barely had a drawdown during the initial war outbreak in March, right? So our bullish dollar views are also mostly against a similar set of low-to-mid-yielders. And the dollar can also be expected to benefit for terms of trade and Fed hawkishness reasons should these hostilities intensify. So broadly, I don't think we need to change tack too much on how we are thinking about the FX world top-down.

Global FX: Keep calm and carry on

Read the full transcript

The candid version is on a podcast,
not the earnings call.

Global FX: Keep calm and carry on

Read the full transcript

The candid version is on a podcast, not the earnings call.

The candid version is on a podcast,
not the earnings call.