What happened
Goldman Sachs strategists said in a Friday client note that the setup for FX carry trades is the most attractive since the early 2000s, CryptoBriefing reported. The bank's argument leans on two pillars. First, the Bank of Japan under governor Kazuo Ueda has held policy rates near zero even as the Federal Reserve, ECB, and Bank of England sit well above 3%.
Second, realized FX volatility has compressed, which mechanically lifts the Sharpe ratio on a margin carry position. Goldman didn't publish a specific basket recommendation in the note excerpt, but its strategists have historically flagged the Mexican peso, Brazilian real, and Indian rupee as the highest-scoring destinations against a short-yen leg. The call arrives with USD/JPY trading in the mid-150s and the pair up more than 8% year-to-date.
Reuters and Bloomberg have covered similar positioning shifts from prime brokers over the past two weeks, but Goldman's framing as a two-decade high is the sharpest on the Street so far this cycle.
Why it matters
Carry trades are not a crypto story on their face. They matter because they are one of the largest single sources of margin liquidity in global markets. When traders borrow yen at effectively 0.
5% and deploy into higher-yielding assets, the marginal dollar rotates through EM FX, high-yield credit, and increasingly into crypto. It's the same liquidity impulse. Wintermute and QCP Capital have both flagged in recent commentary that spot bitcoin