Options Traders Hedge for Dollar Losses Ahead of Jackson Hole
- Key dollar index extends falling streak to hit five-month low
- Risk reversals show higher costs to hedge against dollar drop
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Options traders are positioning for further dollar losses amid bets that Federal Reserve Chair Jerome Powell will reinforce the case for interest-rate cuts during the central bank’s annual gathering in Jackson Hole.
Traders are paying more for options that benefit if the dollar slumps over the next week and month than for those looking for gains, according to indexes of risk reversals on a basket of the currency’s major trading partners.