Sterling Remains Volatile

GBP

The shockwaves from Boris Johnson’s move to suspend parliament continued to be felt on Thursday, with the volatility gauge between now and October 31st for Sterling hitting its highest level of 2019. The move has outraged many of his opponents as they feel the time to prevent a no-deal has been severely limited. As a result, the chances that Johnson will face a no vote of no confidence and possibly a nation election have increased.

As previously mentioned, sterling volatility has rocketed in the aftermath and three-month sterling implied volatility has jumped up to its highest level since December 2018. The one-month measure also jumped to a four-month high, and the longer six-month gauge was at its highest since January. The three month level shows that traders are expecting extremely choppy market conditions between now and the current Brexit exit date.

Key Announcements

10:00 – EUR: Core Consumer Price Index (YoY) (Aug); expected to rise to 1% from 0.9%
10:00 – EUR: Consumer Price Index (YoY) (Aug); expected to remain at 1%

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