Citi: The tariff deadline may be a "non-issue" for G10 forex, but follow Japan.

Jin10 data reported on July 3rd, Citigroup forex strategists believe that the upcoming July 9th tariff negotiation deadline is likely to be a “non-event” for G10 forex. In terms of the EU, Citigroup’s baseline forecast is that both parties will reach a framework agreement before July 9th, at which point the 10% tariff rate will be extended, and negotiations will continue. “Given the recent strengthening of the euro, they speculate that such news will slightly favour the euro, but it may not be a significant driving factor, as much of the good news has already been reflected in the euro’s price.” Regarding Japan, Citigroup believes that, in light of Trump’s recent comments, the likelihood of reaching an agreement is declining. Citigroup stated: “The risk of a Japanese tariff increase seems the highest.” The bank expects that the USD/JPY will climb to 150 this summer and then fall below 140 later this year, as the Bank of Japan is expected to implement policy normalization, leading to a stronger yen.