Morning and blessings on this Maundy Friday!

We expect a very quiet Friday and Monday ahead, with limited markets open and fairly thin liquidity.

The Chart of the Week below offers a strikingly concise illustration of what’s been unfolding over the past few weeks. The USD has completely decoupled from USD bond yields—one of the more esoteric developments I’ve witnessed in my professional career. The ongoing trade war, rumors of Trump considering Powell’s dismissal, and the territorial disputes involving Canada and Greenland have all chipped away at the international appeal of the USD.

This Monday, I’ll release a primer examining whether there’s a viable path toward a non-USD system. Much of last week was spent discussing with our fund counterparts whether there’s a genuine risk of a breakdown in the current USD system. While I’ve yet to hear a credible alternative proposed, I’m not ruling out the possibility that the system is undergoing some kind of reset. My best guess? The USD will remain the reserve anchor—but at a meaningfully lower price point.

The narrative of a complete USD debasement will persist until the USD re-establishes its connection with bond yields. And with most expecting bond yields to move lower, the pain trade may now well be a USD comeback.

Chart of the week: The USD has completely decoupled from bond yields