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

OPTIONS
OPTIONS: Short-end implied vols are generally falling across both DM and EM
currencies so far Monday with GBP/USD the particular standout. GBP/USD vols are
retreating sharply, with the 1m measure falling to 10.4 points and well below
the YTD average of 11.4. This marks a sharp turnaround for GBP markets as
traders are clearly accepting the higher likelihood of a material extension (or
even a revocation) of Article 50 and therefore a delay to Brexit.
- The GBP/USD vol curve remains inverted, however, with 1w vols trading at a 3
point premium to 1m as, technically, the UK could be within five days of a
disruptive 'No Deal' Brexit if the EU fail to grant an extension at this week's
emergency EU meeting due on Wednesday.

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