Euro Dominates Dollar Bearish Bets in Post-US CPI Options Surge

The euro is cementing its position as the options market’s favorite way to bet against the dollar.

Following the release of US inflation data, overall options activity rose about 25% from Monday, with the bulk of the action centered on the common currency as investors positioned for a weaker greenback.

Data from the Depository Trust & Clearing Corporation shows that euro–dollar contracts made up nearly 65% of all dollar-linked options volume on a notional basis. For comparison, the Australian dollar and sterling each accounted for less than 10%. Roughly two-thirds of the euro–dollar trades were structured to profit if the ...