Markets were reassured that Japan’s central bank will not raise rates in a volatile environment and that the U.S. economy isn’t on the verge of a…
This report is from today's CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribeamid ongoing Israel-Hamas cease-fire talks. Qatar's prime minister warned Iranian leaders of the potential consequences of striking Israel when progress is being made, the Washington Post reported, citing diplomats.
But JPMorgan sees the recent turmoil as more than just a market anomaly."Many market participants are dismissing the recent blowup of various crowded trades as a fluke or flash cash, but we see it as more of aThe financial giant believes that while the risks associated with the carry trade could resurface, the heavy losses investors suffered may temper its future impact, potentially preventing a full-blown market meltdown.
"Looking ahead, until the Sharpe ratios on the carry trades get high, we would not think these would be the catalyst for the next major correction," the firm said."Instead, we see the reemergence growth risk as the likely trigger."Chair Jerome Powell's upcoming speech in Jackson Hole, Wyoming.
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