Stephen Jen: If the Iran conflict intensifies, consider shorting the US dollar against the Japanese yen.

The CEO of asset management company Eurizon SLJ Capital, based in London, Stephen Jen, stated that if the Middle East conflict escalates, investors should short the US dollar against the Japanese yen. As global assets are being sold off, the yen may attract safe-haven inflows, prompting Japanese investors to repatriate funds back to Japan. This could reverse the current trend: the yen has been weakening due to Japan being a net energy importer, and the Iran war-induced surge in oil prices exacerbates inflation concerns. "I think shorting the US dollar against the Japanese yen is the trade I like the most, because I believe the top is near," he said in an interview. Since the outbreak of the war on February 28, the yen has depreciated by 2.6% against the dollar. On Friday, the yen fell below the key level of 160 yen per dollar. Traders have been closely watching this level as the Bank of Japan intervened near this level in 2024 to support the yen.