Return of Calm in Safest Assets Signals Peak Panic Easing
- Measure of Treasury volatility plunging most on record
- Dollar-yen implied swings also showing signs of easing
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Markets roiled by indiscriminate liquidations are showing the first signs of calming, as volatility in the world’s safest assets eases.
A measure of swings in the Treasury market is in the biggest four-day decline on record as it plunges from an all-time high set last week. That Treasuries were not immune to the pan-assets sell-off even after the Federal Reserve slashed interest rates to zero epitomized how the need to boost cash positions resulted in a fire sale of parts of the market that are supposed to hold up in times of stress.