Another strong day for currency options.....>

OPTIONS: Another strong day for currency options volumes, with activity led by

USD/JPY and EUR/USD among the majors as well as USD/HKD and USD/CHF, more than

countering quieter USD/CNY and AUD/USD markets Tuesday. Vols are also on the

front foot across DMFX for a second session, although short-end EMFX is less

uniform, with vols pulling back in TRY, RUB and CNH but trade better among KRW,

TWD and THB.

-For a second session, USD/JPY put options have been in demand, with close to $2

in puts waged for every $1 in calls. Volatility bets are among the bigger trades

of the session so far with early European hours seeing a $400mln Y104.25/109.60

3m strangle crossing. Y107 put strikes have in favour from the off, with close

to $1bln in put options traded today due to roll off at that level.

-USD/TWD upside exposure has also helped drive volumes in Asia-Pac markets

despite the modest recovery in TWD spot, with 32.00 and 32.50 call strikes in

focus. Most of the trades crossing eyed a three-month expiry, rolling off on

September 4th.