J.P. Morgan July 11th Foreign Exchange Strategy: USD's 10% Plunge Just the Start, Tariff Risks Severely Underpriced

JPMorgan's latest FX strategy maintains bearish USD outlook despite DXY's 10% YTD decline, weakest H1 since 1980. Report emphasizes tariff risks severely underpriced by markets: threats of 50% on Brazil, 35% on Canada, 50% on copper, up to 200% on pharmaceuticals escalating. August 1st and 12th emerge as critical dates. Safe-haven CHF and JPY poised to outperform, EUR targets 1.20-1.22 medium-term, Q3 raised to 1.19. Triple US policy pressure: fiscal package fails to boost growth, immigration policies drag, Fed independence questioned. Technical indicators turn USD bullish but structural factors override short-term signals. EM FX overbought, tactical reduction recommended.