EUR/USD volatility jumps to one-year high, 10bps June ECB rate cut priced in
The euro-dollar one-month implied volatility jumped to one-year high at 6.6%, thanks to the coronavirus outbreak that has prompted big moves across the fx board while heightening the global recessionary fears, as cited by Reuters.
It’s worth noting that Euro-dollar volatility, which fell to a record low just last month below 4%, surged to 6.75%, the highest since last July, having ended last week around 4.8%.
Meanwhile, Eurozone money markets now fully price a 10-bps rate cut at the European Central Bank’s (ECB) June meeting, per ECBWATCH.
According to CME's FedWatch tool, markets see a 99.3% chance the Fed will cut interest rates by 25 basis points at its March 18th monetary policy meeting.
EUR/USD refreshes three-week high
The EUR/USD pair trades close to a new three-week high printed at 1.1048, as the US dollar remains heavily dumped across the board. A March Fed rate cut is now fully priced-in by the markets.
Author
Dhwani Mehta
FXStreet
Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.
