J.P. Morgan
Global FX Strategy 2026
Performance Snapshot
DXY
100.2
Target: 97.7
EUR/USD
1.15
Target: 1.2
USD/JPY
157
Target: 164
USD Bias
BEARISH
DXY Forecast Path
USD Sensitivity Analysis
Top Currency Pairs
| Pair | Direction | Status | Spot | Live | Trend | Dec 26 | vs Spot | vs Live |
|---|---|---|---|---|---|---|---|---|
| TRY | Sell TRY | -- | 42.45 | -- | 53.5 | -20.7% | -- | |
| NOK | Buy NOK | -- | 10.25 | -- | 9.42 | +8.9% | -- | |
| PLN | Buy PLN | -- | 3.67 | -- | 3.38 | +8.8% | -- | |
| CLP | Buy CLP | -- | 939 | -- | 870 | +8.0% | -- | |
| SEK | Buy SEK | -- | 9.54 | -- | 8.83 | +8.0% | -- | |
| HUF | Buy HUF | -- | 332 | -- | 308 | +7.7% | -- | |
| ZAR | Buy ZAR | -- | 17.31 | -- | 16.25 | +6.5% | -- | |
| AUD | Buy AUD | -- | 0.64 | -- | 0.68 | +5.5% | -- |
Explore Report Sections
Macro Trade Themes
Look out below
Maintain USD shorts
Maintain USD bearish bias in 1H26, but look for smaller magnitude and narrower breadth vs 2025. USD weakness motivated by positive growth in RoW, US twin deficits and Fed asymmetries.
Europe continues to shine
Regional RV and fiscal differentiation
Euro-linked FX are well-placed to benefit on more traction and spillover from fiscal policy. Preferred high-beta FX are SEK and NOK in DM, with tactical use of CHF as a funder.
Challenging the guardians of the JPY galaxy
Bearish JPY on structural issues
Structural issues persist (negative real yields, fiscal), and our analysts suggest that a break of ~162 with no policy resistance could risk aggressive moves higher in USD/JPY.
Tax man still lurking
Fiscal RV basket trades
Long-term trends in deficit and debt sustainability differentiation in G10 should still be a theme next year. We expect somewhat less intensity vs 2025 reflecting more moderate bottom-up projections of term premium.
Fiat gets trapped in 'da basement'
Debasement theme via FX/commodity duals
Debasement proved to be a major macro theme this year. This theme is unlikely to fully disappear next year, especially as CB independence (Fed, BoJ) remains top-of-mind.
Riding the wAIve
AI trade is the bullish carry trade in FX
Global carry is the bullish AI trade in FX given its correlation to equities and its historical performance during past innovation cycles. Copper exporters (AUD in DM) also stand to benefit; EM FX strategy is bullish CLP.
Carry on
DM-funded EM carry
DM-funded EM carry should remain a theme in 2026 given: 1) structural bullishness in EM FX, 2) moderating CB easing cycles, 3) lower volatility and 4) still-positive outlooks for both global equities & global growth more broadly.