**As seen in Macro Walk report 03/17/23, subscribe at cablefxm.co.uk/reports
Despite the market turmoil caused by the banking sector and the massive volatility in rates, FX implied vols declined on the week, ex. EUR/GBP and USD/JPY
High-bet FX saw IV ticked lower across tenors, we would look at this front as a benchmark for market expectations and sentiment. Even EUR/USD front-end vol fell by 62bps to 10.56%, vol structure in the euro holds an inverted curve
Looking at the exceptions, we're set to hear from the BoE, the 1w tenor captures the event, this went up by 79bps on the week to 8.373%. If the central bank was to be perceived as dovish or hold rates steady, the policy divergence could be seen filtered into cross-assets as the ECB held ground and hiked rates by 50bps last week
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