The cost of option protection against long-term deflation in the eurozone has reached its highest levels since late 2008.
Traders suggest a number of reasons for the surge in prices of 10-year euro zero-coupon 0% floors - from hedge funds and pension funds insulating themselves against the risk of deflation, to dealers hedging short year-on-year floor positions. The move comes amid falling inflation breakevens (the difference between nominal and real yields), heightened market volatility and
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