The cost of hedging the euro has reached its highest level since 2017, coinciding with the upcoming US presidential elections.

The options market reflects heightened expectations for currency volatility, indicating that investors are paying more to protect against potential currency swings. This surge in hedging costs is measured by a key options-market indicator, which shows that the relative premium for hedging is significantly elevated.

Market analysts note that this situation mirrors the uncertainty seen during the 2017 French elections, when concerns about the stability of the euro were prevalent. The current environment highlights the growing concern among investors regarding the potential impact of the US election outcome on the euro's value, as they prepare for possible market turbulence in the weeks ahead.