020 7898 0500The probability of a rate rise on 21st March has increased to nearly 100%. With just six days to go, markets will be gearing up for the hike and supplementary comments from new Fed Chair Jerome Powell. A dovish hike will almost certainly cause a dollar sell-off.
GBPUSD implied volatility (a measure of expected future volatility, and a key component in option pricing) has reduced from mid-February highs amidst the global equities rout that saw the FTSE lose over 3% in a day. Why is this important? It means market participants have a somewhat calmer view of trading conditions going forward. It’s also a pivotal consideration when preparing risk management strategies for corporates. Speak to your FX Trader to aid in developing your hedging strategy.
