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After a quieter start to the session,.......>

OPTIONS
OPTIONS: After a quieter start to the session, currency options markets are
looking more active at the NY crossover, with USD/CNY (again), EUR/USD and
GBP/USD activity leading the way. Despite the better volumes, implied volatility
looks slightly more supressed, with DMFX vols on the backfoot, although most vol
term structures remain elevated since Monday's open.
-GBP vols remain the standout among G10, with 1m implied slightly higher
(although still shy of the week's best levels) and the vol curve itself still
very clearly expressing event risk over the 2-6 month horizon - contracts that
capture October 31st 'Brexit Day'. Downside pressure has eased slightly in
recent sessions (evident in risk reversals inching off the lows: put vol
declines) as markets begin to contemplate the cross-party effort to halt a
disruptive Brexit.
-Recession fears are clearly still present in USD/JPY trading - The risk
protection element is particularly evident in the surprising number of trades
eyeing large swings in the JPY: since Monday's open, close to $7bln put notional
traded with strikes at or below Y100.
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