Paul David L181 Green#9

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How do trade wars influence forex markets?

Trade wars disrupt global supply chains, raising tariffs and reducing growth. During the U.S.-China trade war (2018–2019), CNY depreciated while USD strengthened. Institutions hedged through derivatives and shifted exposure. Retail traders often reacted to headlines with whipsaw trades. Benefits: directional moves aligned with fundamentals. Risks: sudden policy shifts reversed positions overnight. Trade wars prove forex mirrors global commerce—tariffs and negotiations directly shape currency flows.