10-02-2025
Trump's Tariffs Make Currency Trading Cool Again After Years of Decline
In the decade Tim Brooks has been buying and selling currencies, he's grown used to feeling that the action is usually elsewhere. He and his team at Optiver Holding BV, a top trading firm in London, rely on volatility to generate quick profits from sudden moves in exchange rates. But dramatic swings largely evaporated after the global financial crisis of 2008, when the biggest central banks began cutting and then raising interest rates more or less synchronously. Occasional bursts of excitement notwithstanding—such as last year's surge in the Japanese yen following a surprise interest-rate hike—currency trading ceded the spotlight to the stock and bond desks.
That changed after Donald Trump was reelected US president on pledges to shake up global trade. The Canadian dollar and the euro suddenly started gyrating with each trade threat, slumping when it seemed penalties were imminent and rallying when Trump announced a reprieve. And as the dollar has strengthened, the Federal Reserve has decoupled from other central banks, signaling it will keep rates steady even as others continue cutting.
