By Vassilis Karamanis, Bloomberg Markets Live reporter and FX strategist
Options traders don’t expect the euro to fluctuate too much after today’s European Central Bank decision, and for a good reason. On aggregate, modest downside risks prevail. A quarter-point interest-rate cut has been well communicated by officials and it’s essentially fully priced in. What makes elevated realized volatility in the currency market unlikely is that there’s a high bar for money market wagers to significantly deviate by Thursday’s close.
