Euro-Dollar Bulls and Bears Set To Hibernate Until March

Euro looks past January to focus on March Fed and ECB meetings

A bull and a bear statue stand outside the Frankfurt Stock Exchange in Frankfurt, Germany
Ralph Orlowski/Bloomberg

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By Vassilis Karamanis

December 18, 2015 at 9:00 AM UTC

This article is for subscribers only.

Currency options show euro-dollar focus is looking past the European Central Bank and Federal Reserve meetings in January and giving a lot more attention on the March policy meetings, Bloomberg strategist Vassilis Karamanis writes. Until then, the euro is likely to trade within a familiar territory versus the greenback, especially as year-end flows may cloud the short-term direction after the Fed liftoff.

Option volatility term structure shows the 3-month tenor is the most demanded across the curve. This is no coincidence as three-month options expire on March 17, the day the Federal Open Market Committee begins its policy meeting while ECB meets on March 5.