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Currency hedging volumes sit slightly.......>

OPTIONS
OPTIONS: Currency hedging volumes sit slightly below average Wednesday, with
lower levels of activity in USD/JPY and EUR/USD countering better volumes in
USD/CNY, GBP/USD and USD/TWD. Generally, implied vols in the short-end are
lower, with particularly sharp falls in vols seen across Asia-Pac FX as the
modestly stronger CNH helps drag implied lower.
-Options trading in USD/CNY has firmed alongside the European open, with USD/CNY
upside exposure in demand from the off despite the recovery of spot CNH. Just
under $3 in calls have been bought for every $1 in puts Wednesday, with call
strikes rolling off at Cny7.00 continuing to garner much attention (a number of
trades have also crossed with strikes layered between 6.9750 and 6.98). One of
the more interesting trades crossing is consistent with a $500mln Cny6.95/7.15
call spread rolling off in mid-April next year, which traded very shortly after
another $500mln call spread with strikes at 6.95/7.10 but rolling off on
December 20th this year. Both trades crossed in the Asia-Pacific session.

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