2026 Yen Intervention Risk & Connections to 2024 Yen Carry Trade

Currency Intervention and Market Impact - The significance of yen intervention is highlighted, noting that coordinated intervention is rare, with the last occurrence in 2011 after the earthquake and tsunami [2][3] - A potential coordinated intervention by the US and Japan could indicate a mutual desire to prevent further weakness of the yen, which has recently been disconnected from economic fundamentals [3][4] - Speculators have shifted from being long on the yen to short, which could lead to increased volatility in currency markets, reminiscent of past market spillovers [4] US and Canada Trade Relations - Recent developments indicate that Canada will not pursue a free trade deal with China, following threats from President Trump to impose tariffs on Canada [9][10] - Canada is attempting to diversify its trade relationships outside of the US but faces resistance, complicating its trade negotiations [11] - The US and China are seen as needing each other for trade, with a trade truce currently in place, although tensions remain with tariffs on other countries [10]