Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Traders Price In Wild Yuan With One-Week Risk Measure at Record

ForexNov 03, 2020 01:45
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters.

(Bloomberg) -- Currency traders are hedging against a volatile yuan after the U.S. presidential election, sending a measure of expected swings to the highest in more than nine years.

The offshore yuan’s one-week implied volatility -- often used as a proxy of market risk -- has more than doubled in the past week to the highest since Bloomberg began compiling the data in 2011. The overnight tenor is also elevated, surging as much as 15 percentage points on Tuesday to a more than two-year high. The metrics based on options track forecasts for movement in the Chinese currency against the dollar.

Currency traders elsewhere are also hedging for wilder moves. Overnight measures for the Australian dollar and sterling were at the highest since April on Tuesday, data compiled by Bloomberg show. A broader JPMorgan Chase (NYSE:JPM) & Co. index tracking implied volatility for emerging-market currencies closed at a one-month high on Monday.

President Donald Trump faces Democrat challenger Joe Biden in Tuesday’s vote, with some initial results expected Wednesday in the Asia region. Biden has been seen as potentially more moderate toward China in the trade war, with some market watchers predicting the countries’ almost-destroyed relationship could improve under the Democrats.

Another contributing factor for greater yuan swings may be that since last week, some Chinese lenders stopped including a volatility-smoothening factor when submitting their reference rates to the country’s central bank.

©2020 Bloomberg L.P.

Traders Price In Wild Yuan With One-Week Risk Measure at Record
 

Related Articles

Bitcoin extends downtrend, falls 12.1% to $47,176
Bitcoin extends downtrend, falls 12.1% to $47,176 By Reuters - Dec 04, 2021 5

(Reuters) - Bitcoin dived 12.14% to $47,176.09 on Saturday, losing $6,567.6 from its previous close. Bitcoin, the world's biggest and best-known cryptocurrency, is down 31.6%...

Bitcoin tumbles 5.5% to $53,436
Bitcoin tumbles 5.5% to $53,436 By Reuters - Dec 03, 2021

(Reuters) - Bitcoin plunged 5.5% to $53,435.9 at 22:04 GMT on Friday, losing $3,112.06 from its previous close. Bitcoin, the world's biggest and best-known cryptocurrency, is...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email