FX Hedging Strategy Series

FxWirePro: EUR/AUD 1m ATM IVs likely to take off owing to RBA and ECB’s QE – Deploy option strips as IV skews indicate OTM strikes significance

Oct 24, 2016 11:41 am UTC| Central Banks Commentary

It was more than obvious that the ECB would extend its QE programme beyond March 2017. As a result it did not seem necessary to mention in great detail that ECB President Mario Draghi indicated just that. It seemed...

EUR/CZK likely to trade above 29.0 level following CNB’s FX intervention

Oct 24, 2016 10:19 am UTC| Commentary Central Banks Economy

The EUR/CZK currency pair is expected to trade above the level of 29.0, if the Czech National Bank (CNB) intervenes in the foreign exchange market, or the koruna should be weaker by around 8% from the current...

FX Hedging Strategy Series

FxWirePro: USD/CNH hits 5-1/2 year highs owing to PBoC currency mechanism – Uphold call spreads and seagull structures on hedging radar

Oct 24, 2016 09:45 am UTC| Central Banks Commentary

The PBoC set USDCNY fixing rate at 6.7690 this morning, higher than our estimation at 6.7640. Afterward, USDCNY striked at 6.7747, the highest since 2010 when the CNH market was launched. Data compiled by SAFE showed...

Chart of the Day Series

Chart of the Day: Hawks and doves at ECB

Oct 21, 2016 16:14 pm UTC| Commentary Central Banks

This fantastic chart, shared by Maxime Sbaihi, Bloomberg Euro-Area economist identifies the doves and hawks at the European Central Bank (ECB). As of now, in the governing council, there are 9 doves, 7 hawks, 3 neutrals...

FX Hedging Strategy Series

FxWirePro: CBRT’s status quo cushions momentary gains in Lira, Rosy times to deploy “USD/TRY Credit Call Spreads”

Oct 21, 2016 13:12 pm UTC| Central Banks Research & Analysis

The Turkish lira rallied yesterday after CBT surprised markets by keeping rates on hold at its MPC meeting. But as the pair rallied today, the last weeks gains are almost wiped off when the dollar looked good today...

ECB stays pat, allays fears of abrupt tapering of asset purchases

Oct 21, 2016 12:43 pm UTC| Insights & Views Central Banks

The European Central Bank left ultra-loose monetary policy unchanged on Thursday and maintained its monthly QE purchases of EUR80bn. The central bank kept the door open to more stimulus in December, firmly shooting down...

FX Hedging Strategy Series

FxWirePro: Is Swiss franc edgy on SNB? 1M lackluster IVs uphold the significance of USD/CHF long put ladders

Oct 21, 2016 12:23 pm UTC| Central Banks Research & Analysis

It is not too hard to draw parallels between the size of the BoJ and the SNBs balance sheets, and hence the potential constraints on the SNBs FX policy which amounts to a soft floor in EURCHF. Its noteworthy that this...