Currency Volatility Report

Currency markets are highly sensitive to politics and economics.  Thus, currency volatility is a key sovereign risk indicator.  CreditPulse provides monthly reports for the world's most commonly traded currencies and semi-annual and annual reports for all world currencies.

Recent Articles

The currency of Central America's most stable democracy is becoming more volatile in a potential sign of trouble for the region.

Costa Rica's currency, the colon, tumbled to a near record low against a weakening dollar last week in a sign of distress and increased risk for a nation that has long been viewed as a bastion of stability in Central America, one of the least stable regions in the world.

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Two of the world's most important, and safest, currencies suffered unusually large declines against the dollar to start the year.

The Japanese yen and Swiss franc, two of the world's most important currencies, fell 7.16 and 6.51 percent respectively against the U.S. dollar in the opening quarter of 2021, an unusual development for two currencies generally seen as safe-havens during times of increased risk.

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The Arab nations of Sudan, Libya and Syria formed a devaluation triangle stretching from the heart of the middle east to north central Africa.

Three nations with thinly-traded currencies that were remarkably stable at the outset of the coronavirus pandemic last year have suddenly undergone devaluations to create a whirlwind of volatility in global currency markets, according to the latest data from the Currency Volatility Index (CVI).

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Inflation is hurting Zambia's currency at a time when a rise in the commodities market should be boosting the value.  "There's no easy way out here really."

A rise in commodity prices would normally be a boon for Africa's second largest copper producer, but that is not the case in Zambia these days where the country's currency, the kwacha, has fallen dramatically against the dollar as the result of rising inflation, high debt and a recent default.

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The coronavirus pandemic sent global currencies on a downward spiral not seen since the 2015 commodities crash.  "Just about every market went on a wild ride."

A year after currency markets were the calmest in a decade, currency volatility surged in 2020 to an average of 3.53 percent, an 80 percent increase from the 2019 mark of just 1.96 percent, as the result of a virus pandemic that sent many currencies to record lows against the dollar.

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Emerging market currencies rebounded strongly against a weak dollar in the fourth quarter of 2020 with the Colombian peso leading the way.

Currency volatility rose to a rate of 1.67%, the highest quarterly rise since the opening quarter of the year, as a weakened U.S. dollar helped boost the values of a broad mixture of currencies across the globe, according to data from the Currency Volatility Index (CVI).

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A declining dollar, low crude oil prices and inflationary pressures from central bank stimulus actions send global currencies on different paths. 

Aided by a weaker dollar, the values of the yen, euro, pound and yuan surged along with many other currencies across the globe in the third quarter of 2020, while inflationary pressure from central bank stimulus spending and stubbornly low oil prices sent the values of other currencies into a tailspin.

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Latin America is starting to resemble Africa as the area of the world with the most problem currencies as five are among the top 10 decliners against the dollar.

Two Latin American countries -- Venezuela and Brazil -- lead the world with the largest currency declines against the dollar in the first half of 2020 with Mexico, Argentina and Colombia not far behind in an ominous sign for a region that is rapidly becoming the world's hot spot for troubled currencies.

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Global currencies rebounded in the second quarter of 2020 against a declining dollar, but not before several plummeted to record lows.

It was a tale of two halves in currency volatility for the second quarter of 2020 as the pandemic-related volatility from the opening quarter carried over into the second quarter with several key currencies suffering all-time lows against a rising U.S. dollar before soon recovering as the dollar began to lose value.

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Fears of coronavirus and a global slowdown jolt the commodities market causing huge declines in the value of commodities-based currencies.

Commodites-based currencies in both developed and emerging market economies took a beating last week as the commodities market plunged 7.28% as fears of a global slowdown compounded by the relentless spread of the coronavirus hit currency markets around the world.

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