MNI BRIEF: Trade War To Increase Volatility Inflation -Panetta

MNI China Daily Summary: Friday, November 15

MNI BRIEF:China Optimistic On Property Despite Investment Fall

CORRECTED-MNI INTERVIEW: NBH To Hold Rates

MNI BRIEF: China Oct Retail Sales Surge On Holiday, Trade-ins

CHINA OCT INDUSTRIAL OUTPUT +5.3% Y/Y VS MEDIAN +5.5% Y/Y: NBS

EZ/UK Bond Supply Calendar: EU Synd; SK, BE Auction on Monday

MNI: US SEP BUSINESS INVENTORIES +0.1%; SALES +0.3%

MNI: US OCT INDUSTRIAL PROD -0.3%; CAP UTIL 77.1%

AUSTRALIA: 2025 Election Outcome Looking More Uncertain According To Newspoll

MNI EXCLUSIVE: German Turmoil Dashes EU's Joint-Funding Hopes -Officials

FED: Powell's Time Looks Up, Replacement Could Be Less Willing To Cut Rates?

© 1982-2024 MNI. All rights reserved.
Terms | Privacy
Log Out
Free Trial

OPTIONS: Front-End Implied Recovering Sharply, USD/CNY Upside in Demand

OPTIONS
BulletMarketsForeign Exchange Bullets
  • Front-end implied vols across G10 are seeing decent support off the post-election lows, helping USD/JPY and EUR/USD 1m implieds recover back toward 8.00 points, and GBP/USD vols back toward 7.5 as markets eye the assembly of Trump's cabinet and the USD rally that's extended to a fresh yearly high this morning.
  • Options volumes remain healthy on the USD rally, with DTCC data showing total notional traded clearing $120bln across both the Tuesday and Wednesday sessions (although post-Veterans Day catch-up could also be boosting activity), and today's trade looks likely to follow suit.
  • EUR/USD hedges have taken market focus over the past week or so, particularly as speculation over parity continues to build, however USD/CNY options are among the most active Thursday, led by demand for upside protection - characterized by trades consistent with a sizeable 7.29/7.36 call spread that crossed in late Asia/early Europe. The position targets an early December expiry and would break even on spot moving above ~7.28.
  • The downside GBP/USD theme remains dominant in options, with today's put/call ratio clearing 4/1, and over $1.5bln notional trading between 1.2300-1.2575 put strikes. 
180 words

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
  • Front-end implied vols across G10 are seeing decent support off the post-election lows, helping USD/JPY and EUR/USD 1m implieds recover back toward 8.00 points, and GBP/USD vols back toward 7.5 as markets eye the assembly of Trump's cabinet and the USD rally that's extended to a fresh yearly high this morning.
  • Options volumes remain healthy on the USD rally, with DTCC data showing total notional traded clearing $120bln across both the Tuesday and Wednesday sessions (although post-Veterans Day catch-up could also be boosting activity), and today's trade looks likely to follow suit.
  • EUR/USD hedges have taken market focus over the past week or so, particularly as speculation over parity continues to build, however USD/CNY options are among the most active Thursday, led by demand for upside protection - characterized by trades consistent with a sizeable 7.29/7.36 call spread that crossed in late Asia/early Europe. The position targets an early December expiry and would break even on spot moving above ~7.28.
  • The downside GBP/USD theme remains dominant in options, with today's put/call ratio clearing 4/1, and over $1.5bln notional trading between 1.2300-1.2575 put strikes.