J.P. Morgan
Global FX Strategy 2026
LIVE25 November 2025USD bearish
FX Macro Quant
J.P. Morgan quantitative strategy signals and factor analysis
Key Insights for 2026
1Next year is likely to be characterized by a low level of central bank activity. G10 and Global carry have been the best strategies during such periods.
2Relative commodity momentum (ToT) has also been a stronger differentiator when CBs are inactive.
3The yield differential on Global/EM carry baskets is low, but strategy can be supported by its cyclical component.
4Carry should benefit vs value on the cyclical component in a lower vol/resilient growth environment.
5G10 fiscal RV basket has legs but stars unlikely to align as in 2025.
6FX vol subdued amid benign risk conditions and central bank inactivity.
Strategy Returns: Strong vs Weak Equity
Avg quarterly returns by equity quartile regime
Strategy Regime Sensitivity
Weak equity return vs strong equity return per strategy
Strategy Returns Heatmap
Color intensity represents return magnitude
| Strategy | Weak Q1 | Q2 | Q3 | Strong Q4 |
|---|---|---|---|---|
| G10 Carry: adjusted by volatility | +3.2% | -0.8% | +2.2% | +2.6% |
| Global Carry: adjusted by volatility | -3.7% | -0.2% | +0.7% | +2.2% |
| EM Carry: adjusted by volatility | -0.2% | -0.3% | -1.0% | +1.6% |
| Global Real Carry (core) | -3.1% | +0.8% | +1.2% | +1.5% |
| G10 Commodity ToT | -2.8% | +1.3% | +2.3% | +1.1% |
| G10 Equity momentum | -4.5% | -0.6% | +0.4% | +0.9% |
| 20 Liquid Momentum (Spot) 12M1M | +3.8% | -1.0% | -1.0% | +0.7% |
| Global carry + growth + value | +3.2% | +1.0% | +1.3% | +0.6% |
| Global composite Growth (EAS+FRI RV) | +3.7% | -0.2% | +1.4% | +0.4% |
| Global Commodity ToT | +1.2% | +1.5% | +0.7% | +0.3% |
| G10 Rates momentum | +1.9% | +1.5% | -0.6% | +0.0% |
| G10 Value REER PPI | -0.8% | +0.1% | -0.4% | -0.1% |
| Global Value REER PPI | +3.5% | +0.4% | +0.1% | -1.2% |
| G10 Growth (RV FRIs) | +4.4% | +0.2% | +0.5% | -1.3% |
| G10 Composite Growth (EAS+FRI RV) | +5.2% | +0.2% | +0.0% | -2.0% |
Strategy Profile
Absolute return magnitude
Live Market Context
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