Currency Volatility Is at an All-Time High Since the Pandemic
The JP Morgan global FX volatility index recorded that currency fluctuations in financial markets reached the highest level since the coronavirus epidemic began.
The JP Morgan index shows global currency volatility to be at its highest level since 2020 in the early days of the pandemic.
While the US Federal Reserve’s (FED) interest rate hike in order to keep inflation under control, which has reached its highest level in 40 years, has fueled the dollar’s rise, other factors such as China’s slowing economy and expectations that global inflation will continue to rise also have an impact on global currencies and causes volatility.
The dollar is on its way to its longest weekly earnings streak since 2018, while the euro is hovering near 5-year lows. The Swedish franc also fell to its lowest level since 2019 against the dollar.
It was stated that the tightening of the US Federal Reserve and the continuation of risk aversion with Russia’s invasion of Ukraine may cause the turmoil in the foreign exchange markets to continue.