With both plummeting equity prices and US dollar strength, there is an added incentive for Hong Kong investors to act, given that the currency peg affords stability. With 2047 not that far away, now is the time to plan a longer-term portfolio diversification strategy.

Investors’ dash for cash prompted market sell-offs last week, as US dollar liquidity is critical to the functioning of the global financial system. But looking beyond the crisis, too much liquidity could give rise to asset price inflation.

The dramatic spike in demand for safe-haven 10-year Treasuries is a sign that markets expect more from the Fed – it must ensure access to US dollar liquidity remains open.

Last week’s jump in the yen reflects the unwinding of yen-funded long positions in US equities, not confidence in the Japanese economy or currency. Coronavirus-related disruption to global supply chains and a drop in tourism will hit Japan’s economy hard.

The US president could play the epidemic like a trump card in his re-election campaign. Even if the outbreak were to affect US economic data, the Federal Reserve would surely ease policy and then Trump would no doubt claim credit for it.

After decades of offshoring manufacturing to China, the disruption to supply chains caused by the Covid-19 outbreak may prompt some sectors to consider diversifying production. The car and smartphone industries have proved quite vulnerable.

Beijing is fighting to contain the epidemic, and it will surely kick-start the Chinese economy just as forcefully afterwards. This is simply the politically astute thing to do, given the public unease over Beijing’s handling of the crisis.

With China focused on averting a pandemic and the US Fed fretting over weak inflation, authorities in both countries look set to keep monetary policy settings accommodative for longer. That may well prompt capital to flow into soft commodities.

Despite Trump’s efforts to talk down the dollar, currency markets haven’t taken the bait. The coronavirus outbreak makes the case for renminbi appreciation less clear-cut and might also weaken the currencies of economies with close ties to China.

As China buys more US goods, possibly at the expense of its trade partners in Europe, Japan and Australia, movements in the currency markets will make winners of some. An overall strengthening of the renminbi, as is likely, may in the end encourage US dollar strength vis-a-vis other currencies.

The deal will allow China to focus on its domestic economic agenda amid a slowdown, including opening doors to foreign firms to serve its growing middle class. It also allays some concerns of the US Federal Reserve.

The movement of the US dollar was tied to market expectations of the US-China trade war and the Federal Reserve’s liquidity provisions and interest rate policy. With few better alternatives for investors, the greenback is unlikely to decline broadly in 2020.

China’s economy is showing signs of recovery. But Japan faces serious problems, even with an Olympic boost to the economy. For one thing, the phase one US-China trade deal may well hurt Japan’s manufacturers.

Maintaining Hong Kong’s dollar peg will, should the economy recover, mean interest rates will be lower than is desirable. Keep the peg anyway: the limited outflows during Hong Kong’s crisis show how important it is for economic stability.

It was natural that China, which relies heavily on food imports, would look elsewhere when US tariffs began to bite. But American farmers should not get their hopes up once the trade war ends – other countries, including New Zealand, Brazil and Argentina, are filling the void.

After years of assuming a closer relationship with China would make it more liberal, the West’s view is changing. Scepticism about Beijing is the one thing US political parties agree on, while an EU carbon tariff could hit China hard.

Yen strength derives from its safe-haven status and the fact that much of Japan’s wealth is held overseas, in foreign assets and currencies; in a crisis, investors repatriate the yen, boosting its demand and giving it strength.

Global debt is growing faster than the global economy, which is simply not sustainable. And as the US-China trade war drags on, major economies that are reliant on the global supply chain are running just to stay in the same place.

China has capitalised on a low-yield environment in Europe to issue euro-denominated government bonds cheaply. It is also setting an example to Chinese companies, in the hope of weaning them off dollar-denominated debt dependency.

The trade war has worried central banks enough to prompt interest rate cuts. However, the effect of this will only be felt later and could coincide with phase one of a US-China trade settlement.

Washington has the US dollar and powerful legislation at its disposal, and can make life difficult for countries just by denying access to the US financial system. Beijing must make the yuan more appealing globally, to mitigate risks to the Chinese economy.

China dangles carrots by offering belt and road investments, and its vast market and trade, while the US wields the stick of sanctions and threats to withdraw financial support. But both rely on the common influence of money to persuade others.

Trump is selling loved-up negotiations but the trade complexities are unchanged. Beijing is wary of any currency deal reminiscent of the 1985 Plaza Accord while the US has yet to decide if it wants a truly free-floating yuan.

The latest figures suggest tensions over the trade war with China are starting to hit home. With more tariff trouble brewing on the Europe front, amid an already slowing economy, Fed officials may be forced to consider more forceful monetary easing.

Japan has much to celebrate, in rugby and trade. But challenges remain: its cars are still exposed to US tariffs, exports are plummeting and interest rates are due to stay flat, driving banks to greater risks in search of profit.

The US Federal Reserve is cutting interest rates not for domestic reasons but in response to slowing global growth and Trump-induced trade anxiety. Effectively, it is creating space for other central banks to ease rates too.

The US president has figured he needs a deal with China to soften the economic impact tariffs are having on his voter base. Three states swung narrowly to him in 2016, but he might lose them if the trade war continues.

China and the US are looking at a new round of trade talks. But dire US relations with Iran complicate China’s attempts to import Iranian oil and meet its huge energy needs.

It is Donald Trump’s own policies that have helped to create the right conditions for continued greenback strength. Unless those policies change, there is little to be gained from the blame game.

China has made no secret of its interest in Arctic resources and has expanded its influence into US spheres of influence. The US president’s anger at Denmark over Greenland wasn’t the first sign that such ambitions trouble Washington.