Analyst: Trump Presidency Will Cause Forex Market to Experience Severe Volatility

BlockBeats News, November 22nd: Forex traders are betting that Trump's policy agenda will trigger significant volatility in the $7.5 trillion daily trading volume forex market. Although it is still unclear at what pace Trump will implement policies that could have a major impact on currencies like the euro, such as trade tariffs, investors generally believe that unpredictability will be a key feature of Trump's tenure.

Furthermore, there are unknown factors, including how other countries will respond to Trump's actions and what impact these retaliatory measures will have on the market.

Dominic Bunning, Global Head of G-10 FX Strategy at Nomura Securities, said: "It is expected that Trump's potential policies will create a greater macroeconomic divergence space, leading to larger forex volatility." Market expectations for a stronger dollar under Trump's administration also support the argument for increased hedging costs, as the correlation between the dollar and volatility is strongest when there is high demand for the dollar.