Options Suggest Traders Overconfident About Inflation Forecasts
- BofA says low volatility doesn’t remove inflation uncertainty
- Cost of putting on inflation strangle is near record lows
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The market is far too confident in its ability to forecast inflation, according to Bank of America Merrill Lynch.
The cost of betting that U.S. inflation will exceed 2 percent or fall below 1.5 percent in about a year is close to record lows, observes strategist Mark Capleton.