JPMorgan has introduced a new market tool called the TACO barometer. The name stands for “Trump Always Chickens Out.” It aims to track how the former president handles trade threats.
The index uses market data to gauge when Trump is likely to back down from aggressive tariffs. It focuses on periods when his rhetoric escalates but action stalls.
Analysts designed the tool to predict turning points. These moments often lead to negotiated deals instead of full-blown trade wars.
Current signals from the barometer suggest Trump is under pressure to strike an agreement. Market volatility and bond yields are feeding into that reading.
The index does not measure Trump’s personal intentions. It tracks how investors position themselves when threats seem hollow.
Traders have used similar informal concepts before. This is the first time a major bank has built a structured indicator around the idea.
If the barometer is right, a deal could come sooner than expected. That would calm markets rattled by months of tariff threats.
The tool remains experimental. JPMorgan cautions it is not a crystal ball. Still, it offers a new way to read political risk.
