[
For dollar-yen, the one-month implied vol dropped for a 10th straight session to 9.48%, the longest slump since December 2019. A similar gauge on EUR/CHF slid to 6.27%, falling for an eighth day out of nine to levels last seen in early March.
The retreat in these measures of market expectations of future price swings — derived from the price of options — for haven currencies suggests sentiment has shifted, and the worst-case scenario for disruptive tariffs may have been avoided.
Agencies“Tariffs are a thing of the past,” Mark McCormick, global head of FX & EM strategy at the Toronto Dominion Bank said in a client email on Monday. “Markets are undergoing a massive repositioning in sentiment over a short period, underpinned by ephemeral narratives.”
The recent move lower stands in contrast to gauges on the yen and franc climbing from mid-February and reaching 2025 peaks earlier this month. The safe-haven appeal of the two currencies means they tend to undergo wild gyrations when tariff fears wreak havoc across risk assets, prompting traders to seek shelter. Those concerns were evident in a selloff in equities that sent S&P 500 down more than 10% peak-to-trough to a six-month low by mid-March.
Monday’s rally in global equities, led by US benchmarks, contributed to a further easing in haven-currency volatility even as they sold off in spot trading. US Treasuries, another popular haven asset, also retreated on expectations that Trump will dilute tariffs due in April.
https://img.etimg.com/thumb/msid-119448420,width-1200,height-630,imgsize-489648,overlay-etmarkets/articleshow.jpg
https://economictimes.indiatimes.com/markets/forex/volatility-pressure-eases-on-safe-haven-currencies/articleshow/119448287.cms
