Trump’s Return Could Ignite Global Currency Wars, deVere CEO Warns

Investors should brace for significant volatility in global markets, as the possibility of a currency war looms under the leadership of former President Donald Trump, according to Nigel Green, CEO of deVere Group, one of the world’s largest financial advisory firms.

Green cautions that while trade wars have dominated recent discussions, the risk of currency wars—where nations deliberately devalue their currencies to gain a competitive edge—has largely been overlooked.

Green points to Trump’s previous administration, which frequently voiced dissatisfaction with a strong US dollar and accused countries like China and European Union members of unfairly manipulating their currencies.

This, he notes, turned currency movements into political tools and laid the groundwork for potential financial disruption.

With global economic conditions diverging, particularly between the US and Europe, Green warns that the foundations for a currency war are being set.

A re-elected Trump is likely to continue using tariffs and protectionist measures, which have historically led to retaliatory actions, including currency devaluation.

This escalation could create significant turbulence in both international trade and financial markets.

The US dollar has been strengthening recently due to a cautious Federal Reserve stance on interest rates and a solid growth outlook. However, this strength could exacerbate tensions, particularly with US trading partners.

Trump may press China and Europe to weaken their currencies, which would put further strain on the global economy.

Europe, grappling with stagnation and low inflation, could be vulnerable to a stronger dollar, potentially forcing the European Central Bank (ECB) to adopt looser monetary policies.

For investors, this shifting dynamic presents both risks and opportunities.

If Trump continues to impose tariffs, countries like China and those in Europe may respond by weakening their currencies, which could push the US dollar even higher.

This could set off a chaotic cycle of retaliation, further disrupting global supply chains and creating inflationary pressures in the US.

Green concludes that the potential for a full-blown trade and currency war is very real, with Trump’s policies creating winners and losers across global markets.

Investors must prepare for the fallout from potential currency conflicts and trade disputes in what promises to be an unpredictable environment.