⚠️💱Front-End FX Volatility Remains Underpriced: Cable FX Macro

**As seen in Macro Walk report 09/01/23, subscribe at cablefxm.co.uk/reports

• The volatility section in our Macro Walk report showed front-end volatilities mostly underpriced as premiums tick below par. This comes as last week implieds fell across the board (ex-CNY), the largest declines were recorded in antipodes and EUR/USD at almost 1 vol

• EUR/USD premium stays below par as we move further into the curve, the 2w tenor captures the ECB September decision. However, the differentials shrinks vs the front-end spread. The largest premiums were seen in the kiwi and sterling, the former 1w implied vol is 253bps below the realized equivalent