Traders Are Souring on Euro Before Fed and ECB Go Head-to-Head
- Risk reversals show euro puts exceed calls over all tenors
- ECB bond-buying announcement won’t support euro, Sinche says
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Currency traders are wagering that even a potential European Central Bank announcement on its timing for ending bond purchases will fail to keep the euro rallying.
The euro is on track to gain about 1 percent this week versus the dollar, for its best performance since February. While it’s perked up from the weakest levels of 2018 on signals from officials that the ECB is about to debate when to taper stimulus, the options market is demonstrating little confidence in the shared currency’s outlook.