No wonder Mario Draghi warns of market volatility

ECB president Mario Draghi’s advice last week for markets to “get used to periods of higher volatility” is aptly timed. The past week saw bouts of exceptional volatility in financial markets, with equities, bonds, and currencies experiencing some very sharp swings, writes Oliver Mangan.

It is a continuation of a trend evident in recent months, marking the end of a long period of directional trading in fixed-income and forex markets.

The normally stable German bond market led the way in volatility last week. Ten-year bund yields started the week at 0.5% before doubling to nearly 1%, then falling back to around 0.85%, with some very large inter-day swings towards the end of the week.