Sterling Is Carrying More of a War Premium Than Euro in Options

The pound looks more vulnerable than the euro in options markets, a sign that traders see the UK as more exposed to a spike in energy prices even after the Iran ceasefire.

Options show that demand for protection against large moves in sterling relative to hedging short-term swings is still higher than when the war broke out in late February. That contrasts with the euro, where the same measures have largely normalized.