Among the wackiest things to come from Donald Trump’s mouth recently is the former US president trying to take credit for China’s US$7 trillion stock reckoning.
“I mean, look, the stock market almost crashed when it was announced that I won the Iowa primary in a record,” Trump told Fox News on February 11. “And then when I won New Hampshire, the stock market went down like crazy.”
In reality, China’s spectacular stock rout has been playing out since 2021, well after Joe Biden moved into the White House. But there is one investor crowd taking notice of the growing odds Asia might soon be grappling with a Trump 2.0 presidency: currency traders.
Trump’s threats to impose tariffs exceeding 60% on Chinese goods has the cost of hedging the yuan soaring to the highest levels since 2017.