JPMorgan Chase & Co. According to the Electronic Trading Survey, the global market turbulence, which was triggered by a series of tariff announcements this week, appears to be the beginning of a volatile year.
Inflation and tariffs have the biggest impact on the market in 2025, followed by geopolitical tensions, according to the annual trade survey. Approximately 41% of surveyed highlighted volatility as the biggest predicted daily trading issue, rising from 28% last year.
“What sets this year apart is the somewhat unexpected timing of volatility,” said Eddie Wen, Head of Global Digital Markets at JPMorgan in an interview. “The market is responding to news headlines in an incredible way, and we expect this trend to continue in the current climate.”
Traders are in Tenterhook, given that they are not clear about the impact of tariffs involved in different asset classes. An annual survey of more than 4,200 institutional traders was conducted last month before President Donald Trump disrupts global markets over a string of trade collections and faces. These concerns are expected to encourage trading in currencies such as the Canadian Dollar, Mexican Peso and offshore Chinese Yuan.
On Monday, the Mexican peso fell nearly 3% before rebounding, bringing the session up 1.5%. The Canadian dollar rose 0.8%, slipping 1.7% before turning the loss back. The dollar rose slightly on Thursday, winning against most currencies in the 10 groups.
Also Read: India’s FMCG volume rose 7% in the third quarter, with rural consumption becoming urban
“These are a huge moves in major currencies that have caused many executions, from hedge funds to retail markets,” says Nzelu. “We’ll see what happens this year, but once it starts, we’ll see some already busy days.”
Hedge funds were the most aggressive in the forex market, but the increase in volume around tariff news is not limited to that segment, he added.
Since Trump was elected president in November, the risk that higher import prices could rekindle inflation has shattered expectations that the Federal Reserve will cut further interest rates this year. Trump ordered a 25% tariff on all goods from Canada and Mexico, and took effect Tuesday, but leaders from both countries have pledged greater efforts to stem the tide of illegal migration and illegal drug trafficking. Later, they were put on hold. A full 10% tariff on imports from China has come into effect, but the White House has not ruled out the suspension.
All survey respondents said they hope to increase their e-trading activity. It follows a long-standing trend across asset classes, even for less liquid securities.
“Electronic trading is important as tariff announcements can occur over the weekend. Clients will encourage liquidity to rebalance their portfolios at the start of their session,” said London Sunday. Referring to the traditionally low period of flow that occurs in the evening, Nzelu said. “During these critical times, they aim to access multiple channels, platforms and banks.”
Regarding the platform, traders are split into single dealers (28%) and multi dealer venues (38%), with 34% using both. “Reducing execution/mediation costs” is a top priority for those choosing a single dealer platform, but reducing information leakage is especially important for crypto and cash equity traders.
Meanwhile, around 71% of respondents said they had no plans to trade cryptocurrency. That’s even if Bitcoin and other digital currencies hit record highs after winning Trump’s election. White House Crypto Czar David Sacks said the administration is studying the possibility of creating a “Bitcoin reserve,” but it appears that barriers to banks providing digital asset services are declining .
“Recent headlines suggest that the new administration is supporting the market and recent changes have reduced barriers to traditional banking community members entering this space,” Wen said. “The details are light at the moment, but we’re paying attention to how this will develop.”
More stories like this are available at bloomberg.com
