Citi Research discusses the market conditions and flags 7 reasons why investors may look to extend the current risk-aversion trades (long safe havens like CHF, JPY, Gold).

"With risk sentiment continuing to deteriorate by the week, investors may look to extend risk aversion trades into 2020 as: - (1) worsening US – China trade tensions risk a disinflationary impulse from  CNY heading towards 7.25 - 50; (2) Possible risk of USD intervention by the US; (3) Rising odds of a “No Deal” Brexit; (4) Re-emergence of Italy political risk; (5) Slowing global growth leading to central bank policy responses and a “race to the bottom” in rates sparking a currency war; (6) Potential damage to US – Japan/ Europe trade relations should Trump impose tariffs on auto imports; (7) 2020 - US presidential election year leaves scope for a more aggressive Trump; (8) tensions in HK, Iran, North Korea, now Argentina and India – Pakistan,"