What's next for trade and supply chains?
The desk positions that ongoing supply chain disruptions will continue to impact global trade dynamics, particularly as economies rebound post-COVID, resulting in volatility in currency markets. Per the full note source, Richard Hayes of Nordea underscores that these challenges are not just recent, stemming from inherent issues predating the pandemic. This continued strain on supply chains signals potential trading opportunities in the FX markets, especially for currencies connected to commodity-driven economies that could see fluctuation in demand. With no immediate catalysts on the calendar, traders should remain focused on supply chain developments as a barometer for currency trends.
What the desk is arguing
The desk asserts that ongoing disruptions to supply chains are expected to affect global trade dynamics, leading to heightened market volatility in the foreign exchange sphere. This is highlighted by Richard Hayes from Nordea, who notes that while many focus on recent disruptions due to COVID, many of the issues are deeply rooted and systemic.
The backdrop provides essential data on economic recovery trajectories. For instance, as demand spikes post-pandemic, industries are struggling to deliver, which could distort pricing power across various currencies, emphasizing the need for adaptive trading strategies. Supply chain issues are projected to linger, thus affecting trade balances and currency valuations.
Where it sits in our coverage
Our consensus target for the EUR/USD currently sits at 1.075, within a range from 1.04 to 1.12, with noted forecasts from notable firms: - jpmorgan: 1.10 (Mar26) - bofa: 1.04 (Mar26)
The desk's call aligns closely with jpmorgan, suggesting that the complex interplay of supply issues and economic recovery could support appreciation of the euro against the dollar, contrasting with bofa which reflects a more conservative outlook.
How other firms see it
Aligned firms highlight a bullish outlook influenced by demand spikes affecting supply chains, creating pressure on currency pairs like EUR/USD. Meanwhile, contrary views from bofa propose that any recovery might be overshadowed by persistent supply constraints and geopolitical issues.
Monitoring related pairs such as AUD/USD remains crucial, particularly as commodity exports may be influenced by supply chain inefficiencies, reflecting broader market sentiments.
How firms align with this view
Aligned with the desk view
Contrary positioning
Key takeaways
- 01Supply chain disruptions continue to influence global trade
- 02Economic recovery post-COVID may amplify currency volatility
- 03Traders should focus on supply chain news as a trading catalyst
Market implications
Traders should monitor the EUR/USD closely as it grapples with the fallout from ongoing supply chain issues, making a breach of the 1.075 level critical for understanding directional bias. Additionally, remain attentive to broader supply chain narratives which may impact commodity-driven currencies.
Risks to this view
A significant easing of supply chain disruptions or unexpected geopolitical stability could reverse the current market sentiment, pushing currency valuations back into neutral ranges, particularly for the euro against the dollar.
Podcast What's next for trade and supply chains? 30-11-2021 Challenges facing global supply chains and the knock on effects on trade have been making headlines around the world. As economies bounce back from a period of reduced activity, supply chains have been struggling to cope with the sudden increases in demand. In this Open Insights podcast, Richard Hayes, Acting Head of Trade Solutions Denmark at Nordea, takes a close look at the current state of global trade and the bumps supply chains have encountered as economic output recovers.
Richard also discusses the fundamental issues that have been around for some time before COVID lockdowns that area also contributing to supply delays and shortages. Looking at the future, Richard reflects on the further challenges on the horizon that will likely continue to effect trade and supply chains. We wanted to show you a Podcast but you cannot see it as you have not enabled cookies Click here to update your consent Share on Facebook Share on Threads Share on Linkedin 30-10-2025 Markets and investment Nordea to offer customers access to an exchange-traded product tracking Bitcoin As the European regulatory environment for cryptocurrencies has matured and the demand for virtual currencies and cryptocurrencies is growing across the Nordics, Nordea has decided to allow customers to trade in a crypto-linked product on its platforms.
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Nordea’s view is that interest rates are likely to remain low, and our experts accordingly expect a pickup in deals. Read more Scroll to top
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