Rate hits extended session lows at $1.2910,...>

CABLE: Rate hits extended session lows at $1.2910, the lowest rate since April

26 with a fall through $1.2876 opening multi-month lows at $1.2866 and

mid-February lows at $1.2773. The move in spots runs in parallel with 1m risk

reversals which, today, have slipped back below the zero level, moving back in

favour of GBP/USD puts after spending much of the past two weeks in positive

territory (in favour of GBP calls). Mirroring this, GBP/USD puts have been

favoured over calls so far Tuesday, with just under $2 in GBP/USD puts traded

for every $1 in calls.

-Moves follow further signs of disharmony among UK lawmakers toward UK PM May's

approach to Brexit compromise discussions with the opposition Labour party,

calling into question whether May can get any form of deal through the Commons

even with opposition support. Nonetheless, cabinet meetings today reaffirmed the

government's commitment to get a Brexit deal passed by the Summer recess.

-The GBP/USD implied vol curve continues to steepen, with contracts capturing

the new Brexit deadline at end-October gaining while short-term vols retrace (1w

vols have fallen over 1 points in the past week).