The foreign exchange market finds itself anesthetized by the Covid-19 crisis and its effects on the world economy are significant. Currencies are experiencing a long decline in volatility.

In contrast to the chaotic movements of cryptocurrencies, currencies are experiencing a long decline in volatility. Last year, the euro moved between 1.06 and 1.22 dollars. The markets anticipate a continuation of this stability, at a level of 1.22 to 1.23 dollars this year. Forecasts range from 1.14 to 1.30 dollars, according to the consensus established by the Bloomberg agency.
US growth would widen the gap with the rest of the world, attracting capital flows and causing interest rates and the dollar to rise. The Turkish lira, South African rand and Brazilian real started to price in this risk and suffered, with declines of 3% to 5% in one week.
In four months, the most fragile emerging currencies (Turkey, South Africa, Brazil) had plunged by more than 15% and the king dollar, the ultimate safe haven currency, rebounded by 4%. The volatility of emerging currencies can be fueled by social and political unrest, and post-Covid economic stagnation weakens their governments.