Barclays Sees FX Volatility Staying Elevated as Dollar Rises

07:20 PM EDT, 10/27/2026 (MT Newswires) -- Barclays strategists expect volatility in Group-of-10 currencies to increase and remain elevated as the dollar strengthens and interest-rate swings rise, Bloomberg reported Tuesday, citing a note from the bank. Realized volatility has yet to catch up with levels priced into currency options, though Barclays expects the gap to narrow. The strategists said the probability of an increase in foreign-exchange volatility would likely decline only in the very near term, even if the dollar's rally pauses. Higher currency volatility is creating an unfavorable environment for carry trades, which have begun to underperform after strong returns since the US announced sweeping tariffs in April 2025.