Sterling Volatility Rises Ahead of May Brexit Speech

Financial market bets on swings in the value of sterling over the next week reached their most extreme since October on Friday, driven by news that Prime Minister Theresa May will lay out more of her plans for Brexit negotiations next Tuesday.

One-week implied volatility – options contracts which allow traders to bet or hedge against swings in the currency over the next seven days – started climbing on Thursday afternoon after Downing Street confirmed the timing of the speech.

They rose again in early trade in London on Friday, hitting 14.775 percent compared to levels of around 11 percent mid-session on Thursday.

Reuters

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