Short-end implied vols are falling..........>

OPTIONS: Short-end implied vols are falling further still Tuesday, with

particularly sharp declines in USD/TRY, GBP/USD and USD/RUB. GBP/USD 1m vols are

now nearing the lowest levels of the year as a lengthy extension to Brexit and

narrowing likelihood of a disruptive 'No Deal' Brexit are increasingly priced

in. Today, 1m vols struck 10.25 points, just above the mid-February lows of 9.60

which would erase the entirety of the march higher seen since November last

year. This pattern is repeated across almost all GBP/USD tenors, with the

sharpest declines noted in 2w, 3w and 1m measures.

-RUB implied vols appear to be benefiting from the surging oil price, which

remains higher today after Brent topped $71/bbl, pressing USD/RUB 1m vols toward

the March (and multiyear) lows of 9.1 points.

-The standouts in vol markets today are all EMFX, with USD/ZAR, USD/INR and

USD/BRL 1m measures inching higher.