🇨🇭LIVEDESK: FX Flows

• The USD retracing overnight gains as European equities opened higher and EM rallied. Better USD selling through this morning, with EUR buying the most notable after comments from ECB members Knott and Holzmann yesterday leading European yields higher.

• In vol space the desk has seen demand for the NFP date this Friday with the event weighting marked higher to 23bp from around 18bp yday. Directional interest has been light but focused on downside.

• CHF and JPY continue to underperform, with sporadic topside interest in both USDCHF and EURCHF via more vol neutral structures and Macro names have been selling JPY, offset partially by some retail demand.

• In Asia, USD selling driven by Macro names across the board as USD longs are further trimmed following JH last week, SGD selling has been the exception-with further demand for downside strikes in USDINR. In CEEMEA flows have been light but it has all been one way with USD selling.

• In the AUD, the market is deriving shorter post-NFP options on the move higher. There were a few panic pays for Friday/next week options in the morning. Supply of surface from systematic names puts pressure on the Risk Reversal curve with lm AUDUSD 25d RR now around 0.8.

• Meanwhile, in CAD, the market is still struggling with end-of-September to beginning-of October 1.28-1.29 shorts. 1-month USDCAD RR traded 1.3 today.

• NFP priced in at —20bps, which looks on the low side compared to AUDUSD and USDJPY at 30bps and 25bps resp.