March 19, 2020 / 10:33 AM / 13 days ago

Implied FX volatility gauges jump as dollar demand intensifies

FILE PHOTO: A man counts U.S dollar bills at a money exchange office in central Cairo, Egypt, March 7, 2017. REUTERS/Mohamed Abd El Ghany

LONDON (Reuters) - Expected price swings for some of the world’s biggest currencies rocketed to multi-year highs on Thursday as a broad rush for U.S. dollars forced traders to dump currencies across the board.

Expected volatility gauges for the British pound against the dollar leapt to 24.4%, its highest level since before the 2016 Brexit vote. The pound tumbled to its lowest levels since 1985 in chaotic trading. GBP1MO=

Similar moves were seen in euro-dollar one-month implied volatility, with the gauge rocketing to its highest level since the euro zone crisis at above 14% EUR1MO=FN

Reporting by Sujata Rao; Writing by Saikat Chatterjee

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