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Lacklustre currency hedging volumes.........>

OPTIONS
OPTIONS: Lacklustre currency hedging volumes across the board so far this
morning, with below average trading activity across EUR/USD, USD/CNY and,
surprisingly, GBP/USD, with the volatility in the spot price this morning doing
little to stimulate options trades. The lack of clarity also covered by the
put/call ratio of trades crossing the DTCC today hitting exactly 1.0.
Volatility markets, however, remain elevated with GBP/USD 1m vols holding above
13.5 vol points. The GBP/USD vol surface provides further clues - OTM puts
covering the 2-4months (capturing the potential EU exit date at end-March) are
the standout, with the GBP/USD Smile curve also mimicking the skew. 

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