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FX options wrap - Trump trade, ECB risk, revealing sales

BUZZ-FX options wrap - Trump trade, ECB risk, revealing sales Shorter dated expiry implied volatility in most of the major currency pairs remains under pressure and reflects the lack of current FX realised volatility. That's not expected to change much until the U.S. election, where implied volatility is higher and better supported. Overnight expiry implied volatility remains very low, even in EUR related pairings which now include Thursday's ECB policy announcement .
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British inflation sends pound briefly below $1.30, dollar firm on Fed outlook, potential Trump win

British inflation sends pound briefly below $1.30, dollar firm on Fed outlook, potential Trump win Updates prices at 1120 GMT By Alun John and Kevin Buckland LONDON/TOKYO, Oct 16 (Reuters) - Sterling tumbled to its lowest in two months on Wednesday after softer than expected British inflation data offered scope for the Bank of England to cut rates more forcefully, while the euro was at a 10-week low ahead of a European Central Bank meeting.
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These FX options are becoming 'the Trump trade'

BUZZ-COMMENT-These FX options are becoming 'the Trump trade' Oct 16 (Reuters) - U.S. Republican presidential candidate Donald Trump has regained his poll lead over Democratic rival Kamala Harris with only three weeks to go before the U.S. election and it's fuelling demand for options to hedge the risk of a stronger USD rebound. USD call options give holders the right to buy the USD at levels that are advantageous to the FX spot rate, for an upfront premium.
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British inflation data hurts pound, Dollar firm on Fed outlook, potential Trump win

FOREX-British inflation data hurts pound, Dollar firm on Fed outlook, potential Trump win Refiles to add dropped FOREX tag, no changes to text By Alun John and Kevin Buckland LONDON/TOKYO, Oct 16 (Reuters) - Sterling tumbled to its lowest in two months on Wednesday after softer than expected British inflation data offered scope for the Bank of England to cut rates more forcefully, while the euro was at a 10-week low ahead of a European Central Bank meeting.
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Dollar firms as investors weigh Fed outlook, potential Trump win

FOREX-Dollar firms as investors weigh Fed outlook, potential Trump win Updates at 0552 GMT By Kevin Buckland TOKYO, Oct 16 (Reuters) - The U.S. dollar hovered near two-month peaks versus major peers on Wednesday, supported by expectations the Federal Reserve will proceed with modest interest rate cuts and a rise in betting odds for a second Donald Trump presidency.
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NZ dlr hits 2-month low as benign inflation strengthens bets on outsized rate cuts

NZ dlr hits 2-month low as benign inflation strengthens bets on outsized rate cuts SYDNEY, Oct 16 (Reuters) - The New Zealand dollar slipped to a two-month low and bonds rallied on Wednesday as soft inflation readings bolstered bets for aggressive monetary easing, which also dragged its Australian counterpart lower. New Zealand's consumer price index(CPI ) rose 0.6% in the third quarter, below forecasts of a 0.7% increase.
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Aussie hit by China stimulus scepticism; US dollar firm on Fed outlook

FOREX-Aussie hit by China stimulus scepticism; US dollar firm on Fed outlook By Kevin Buckland TOKYO, Oct 16 (Reuters) - The Australian and New Zealand dollars slumped on Wednesday as scepticism grew about top trading partner China's stimulus, while the greenback hovered near two-month peaks versus major peers on wagers U.S. interest rate cuts will be gradual.
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New Zealand annual inflation at 2.2%, within central bank target range

UPDATE 2-New Zealand annual inflation at 2.2%, within central bank target range Adds economists' comments in paragraphs 3-4, 9-10, market reaction in paragraph 6 By Lucy Craymer WELLINGTON, Oct 16 (Reuters) - Inflation in New Zealand returned to the Reserve Bank of New Zealand's target range of 1% to 3% in the third quarter, keeping the door open for the central bank to continue aggressively cutting rates .
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US dollar continues uptrend as Fed policy provides lift

FOREX-US dollar continues uptrend as Fed policy provides lift U.S. rate futures price in nearly 100% chance of 25-bp cut in November Yen weakness versus dollar eases Dollar initially falls on news of easing Middle East tension Adds new comments, graphic, updates prices By Gertrude Chavez-Dreyfuss NEW YORK, Oct 15 (Reuters) - The U.S. dollar edged higher against most major currencies on Tuesday, resuming the latest uptrend that took it to more than two-month highs fueled by expectations the Feder
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US dollar rally pauses as markets assess Fed policy outlook

FOREX-US dollar rally pauses as markets assess Fed policy outlook Recasts, adds new comment, byline, NEW YORK dateline, bullets, FX table, updates prices FX market yet to price in election uncertainty, analyst says U.S. rate futures price in 90% chance of 25-bp cut in November Yen weakness versus dollar eases By Gertrude Chavez-Dreyfuss, Samuel Indyk NEW YORK/LONDON, Oct 15 (Reuters) - The U.S.
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FX options wrap - Pricing says FX is still going nowhere fast

BUZZ-FX options wrap - Pricing says FX is still going nowhere fast Another day of FX consolidation and limited volatility which keeps the pressure on FX option implied volatility . EUR/USD tested below 1.0900 but lacked the impetus needed to excite the FX options market. The ECB is widely expected to cut rates by 25 bps on Thursday, so it would take a surprise hold to reignite related FX volatility.
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Dollar steady near two-month high as markets weigh policy outlook

FOREX-Dollar steady near two-month high as markets weigh policy outlook Updates at 1120 GMT By Samuel Indyk and Ankur Banerjee LONDON, Oct 15 (Reuters) - The U.S. dollar was perched near it highest in more than two months against major currencies on Tuesday, spurred by wagers the Federal Reserve will proceed with modest rate cuts in the near term.
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Explainer - Implied Volatility: a window into FX market sentiment

BUZZ-Explainer - Implied Volatility: a window into FX market sentiment Oct 15 (Reuters) - Implied volatility is a key component of an FX option premium, but what is it and how is it useful to the wider FX market? FX options are forward looking and often used to hedge or speculate on future scenarios in the FX spot market. The probability of any particular scenario happening is used to determine the option's cost - like an insurance premium.
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Dollar steady near two-month high as markets weigh Fed outlook

FOREX-Dollar steady near two-month high as markets weigh Fed outlook Updates at 0823 GMT By Samuel Indyk and Ankur Banerjee LONDON, Oct 15 (Reuters) - The U.S. dollar was perched near it highest in more than two months against major currencies on Tuesday, spurred by wagers the Federal Reserve will proceed with modest rate cuts in the near term. A string of U.S.
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Dollar hangs near two-month high, yen nudges 150/dlr

FOREX-Dollar hangs near two-month high, yen nudges 150/dlr Updates at 0501 GMT By Ankur Banerjee SINGAPORE, Oct 15 (Reuters) - The U.S. dollar was perched at an over two-month high against major currencies on Tuesday, spurred by wagers the Federal Reserve will proceed with modest rate cuts in the near term, pinning the yen closer to the key 150 per dollar level.
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Australian, NZ dollars turn lower as yuan skids to one-month trough

Australian, NZ dollars turn lower as yuan skids to one-month trough SYDNEY, Oct 15 (Reuters) - The Australian and New Zealand dollars struggled to make new ground on Tuesday even as Wall Street soared to a record close, with sentiment still being weighed down by a lack of stimulus measures from China after a slew of lacklustre data. The Aussie AUD=D3 fell 0.2% at $0.6712, having fallen 0.4% overnight to as far as $0.67, the lowest in a month.
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Dollar at over two-month high, yen near 150/dlr

FOREX-Dollar at over two-month high, yen near 150/dlr By Ankur Banerjee SINGAPORE, Oct 15 (Reuters) - The U.S. dollar was perched at an over two-month high against major currencies on Tuesday, spurred by wagers the Federal Reserve will proceed with modest rate cuts in the near term, while the yen inched closer to the key 150 per dollar level. The euro EUR=EBS was steady in early Asian hours but close to its lowest level since Aug.
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FX options wrap - Nowhere fast, election bid, USD hedge

BUZZ-FX options wrap - Nowhere fast, election bid, USD hedge Shorter term expiry FX option implied volatility remains depressed to highlight a lack of short-term realised volatility expectations, with overnight/next day expiry option premiums hitting their lowest levels since July . Premium/break-even prices taken from overnight expiry implied volatility in EUR/USD, GBP/USD and AUD/USD, were at/below 25 USD pips on Monday's U.S.
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FX is going nowhere fast - according to options

BUZZ-COMMENT-FX is going nowhere fast - according to options Oct 14 (Reuters) - Implied volatility serves as a proxy for realized FX volatility when pricing options. For very short-term expiries, implied volatility is currently exceptionally low. Overnight expiry is the next working day at 10-am New York/3-pm London and is the shortest duration option.
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Dollar holds near highs as investors parse China's stimulus plans; euro dips

FOREX-Dollar holds near highs as investors parse China's stimulus plans; euro dips Updates at 0757 GMT By Vidya Ranganathan and Medha Singh SINGAPORE/LONDON, Oct 14 (Reuters) - The dollar hovered near recent highs on Monday as investors digested China's somewhat disappointing weekend stimulus announcements, while the euro extended its fall ahead of a central bank meeting this week.
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