OIL: Brent Options Skew Switches Back in Favour of Calls
Jan-08 13:52
The Brent crude options skew has switched back in favour of the calls as front month futures rallied to the highest since mid October earlier today.
- Crude futures and time spreads continue to rally with concern for tighter global supplies due to US sanctions on Iran and Russia while US crude stocks are expected to draw in data due later today.
- The Brent second month 25 delta call-put volatility skew has turned more bullish this week from about -0.5/bbl at times last week to around +0.7% today.
- The WTI second month skew has turned less bearish, narrowing from as wide as -1.4% on Jan. 3 to about -0.1% today.
- Brent second month implied volatility has edged higher in recent days to edge up from the lows seen in December. Brent second month implied volatility is today up to 26.2% and WTI at 27.6%.
- Brent MAR 25 up 0.3% at 77.28$/bbl
- WTI FEB 25 up 0.4% at 74.57$/bbl
Source: Bloomberg
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BOE: Ramsden wants QT to be "gradual and predictable"
Dec-09 13:46
Ramsden asked if the BOE could become more "market orientated" and move away from a fixed calendar of sales for QT.
- He says the approach taken has stood the test of time. The operations are very much with a view to the market being able to digest. Says that QT will be "gradual and predictable" by setting out annual target and quarterly auction calendar. Says that the predictability helps QT happen in the background and the market understand. And says the government's [DMO] sales are much more significant.
FED FUNDS FUTURES: BLOCK: Jan'25 Fed Funds Sale
Dec-09 13:39
- -4,000 FFF5 95.64, post time bid at 0829:53ET, the Jan'25 contract trades 95.64 last (+0.00)
US: MNI POLITICAL RISK - Trump's First Post Election Interview
Dec-09 13:29
- US President-elect Donald Trump gave his first network media interview since winning the presidential election, speaking to NBC’s Meet the Press in a Sunday broadcast.
- Trump said: He has no plans to replace Fed Chair Jerome Powell; he would do something "very strong, very powerful" on border security and tax reform in his first 100 days, and he has communicated with Chinese President Xi Jinping since winning the election.
- Congressional leaders released the final draft text of the National Defense Authorization Act on Saturday, teeing up a vote on the House floor this week. The final NDAA text fails to include a package of bills that would have codified a Biden executive order restricting US investment in certain high-tech sectors in China. House Speaker Mike Johnson (R-LA) may include the China package in a Continuing Resolution to fund the government beyond December 20.
- Trump met trilaterally with French President Emmanuel Macron and Ukrainian President Volodymyr Zelenskyy in Paris yesterday, calling after the meeting for "an immediate ceasefire" in Ukraine.
- President Biden and President-elect Trump both weighed in on the collapse of the Syrian regime of Bashar al-Assad, with Biden committing to preventing the return of ISIS and Trump warning "DO NOT GET INVOLVED!”
- Trump's Special Envoy to the Middle East Steven Witkoff said it will not be "a pretty day" if Israeli hostages in Gaza aren't freed before Trump's inauguration.
- Poll of the Day: A majority of Americans approve of the Affordable Care Act.
Full article: US Daily Brief
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