🇨🇭LIVEDESK:

*Rebalancing Likely Behind Gold Move. It is worth highlighting going into quarter-end that gold has underperformed US 10-year bonds by 5, and US equities by around 15-20v%. If there is any rebalancing being done it is likely to be gold buying at current levels - and probably what is behind today's move

*Topside USDJPY interest continues on the uptrend with spots breaking higher first thing in Asia. Vols remain more or less supported (1m last traded 6.7), though client interests are shifting into more leveraged plays, as opposed to the outright vanillas or digis seen yesterday. Risk reversals continue to belle under pressure with the spot-vol correlation firmly realizing for topside from these levels, though 1m risk reversals are still trading .1 for USD puts

*Options activity remains quite light in GBPUSD but the direction has still been for GBP calls, with some recent buying of call spreads and digitals in the front end. And yet the front end of the curve softer, with more systematic selling ahead of the long Easter weekend. The main focus is the next Bank of England meeting and the Scottish parliament (and local) elections on May 6