💶Euro Downside Demand Rises The Most In More Than A Year: Cable FX Macro

• G10FX/USD downside demand was seen across the board, EUR/USD sort-term risk reversals fell for the third consecutive session on a week holding tier-1 data and the ECB rate decision

• EUR/USD 1w risk reversals now favor puts over calls by 60bps, the most since March 2023, the 1m tenor now stands 61.5bps in favor of puts vs just 12bps a month ago

• FX volatility ticked higher on Friday session to breach March highs, a measure of global currency implied volatility constructed by J.P. Morgan now stands at 7.46%, the highest level since February 9

• A Bloomberg measure of 1m dollar risk reversals sees calls favored over puts by 44bps, the highest since November. This is a sharp reversal from March, when investors demand for USD puts surpassed the demand for calls to levels not seen since 2020