The upper left-hand corner of the vol.......>

EURIBOR: The upper left-hand corner of the vol matrix is humming into life

again.  EUR normalised swaption volatilities are rising but selectively, with

3m2Y hitting 44.7bp/vol, its best levels since June. Longer tails like 10Y and

30Y are rather insulated from this pick up and the bottom right of the matrix is

plumbing lows as the matrix re-prices. 

- The pick up of short-dated, short-tailed volatility can be explained by the

imminent Fed Chair decision, possible Fed hike in December, the ECB on Thursday

and probable Bank of England rate hike next week. What is more surprising is the

softness elsewhere in the grid.