US Exceptionalism Trade Is Rapidly Evaporating in Dollar Options

Dollar options pointed to deepening doubts over the outperformance of the US economy amid a shift in sentiment toward the growth potential of other major economies around the world.

A gauge showing demand for hedges against a rise in the dollar has seen its steepest slide since the height of market fears about the pandemic in 2020, according to data compiled by Bloomberg. The spread between one-month call and put options for the greenback against the currencies that make up the Bloomberg Dollar Spot Index has dropped 0.56 percentage points this week.

The move reflects a possible shift in market ...