NAFTA renegotiations could cap USD/JPY gains - SocGen

Société Générale's director of FX and money market sales at the bank's Tokyo branch, Kyosuke Suzuki, is addressing the NAFTA renegotiations that are currently underway and their potential impact looking forward.

Key highlights

Suzuki has noted that the NAFTA negotiations are likely to cap upside potential in the USD/JPY pair ahead of the end-of-March deadline that has been put in place by the Trump administration. The term limit is likely to keep Monday's risk-on momentum "temporary", he says.

Suzuki also mentioned the Navarro and China comments over the weekend focusing on China and the US' apparent willingness to meet in the middle of trade and tariff negotiations, but Suzuki stated that it's too early to factor in a successful conclusion to the tariff tug-of-war and that markets should avoid becoming "unconditionally optimistic" about potential trade wars.