Sterling options volatility nears 'Liberation Day' highs ahead of UK budget
ReutersNov 25, 2025 10:43 AM
LONDON, Nov 25 (Reuters) - The cost of hedging against big near-term moves in the pound against the euro shot to its highest since April on Tuesday, reflecting trader nervousness ahead of finance minister Rachel Reeves' budget in a day's time.
Overnight implied options volatility, a measure of demand to own derivatives to protect against turbulent price action, shot to as much as 12.2% for euro/sterling EURGBPONO=. That was the most since April, when U.S. President Donald Trump's initial "Liberation Day" tariff announcement stirred up extreme market turbulence and the measure hit 15%.
It was last at 10.82%, according to LSEG data.
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