US Dollar Volatility Sinks as Carry Trades Hold, ING Says
Declining FX volatility and steady carry trades signal market comfort with the Federal Reserve's rate stance, according to ING's Chris Turner.
Chris Turner of ING notes that FX volatility is falling as investors appear comfortable with the Federal Reserve holding or potentially tightening rates.
This decline in volatility is being supported by persistent carry trades, which benefit from a stable or hawkish rate environment.
The combination suggests that dollar-funded carry strategies remain attractive, keeping the greenback underpinned in the near term.
Source: FXStreet Forex News