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Forex Flash: Options logic teach that currency war does not mean booming volatility - Societe Generale

Sebastien Galy of Societe Generale note that the spectre of a currency war raises concern that FX markets will turn more volatile.

He feels that although large depreciations are certain to generate transitory spikes in realised volatility, whether they will have a durable impact on implied volatility is far less certain. He writes, “Vol curves should flatten when officials are more vocal, but that should not fuel a higher volatility regime. In a currency war context, going long butterflies is arguably a better strategy than going long vega.”

Forex: USD/JPY searches for direction, trading at 93.27/32

The USD/JPY has oscillated between a sizable 57-pip range Friday (92.93 – 93.50), as the exchange is behaving in a volatile manner during European trading. In recent minutes the pair has rebounded off the 93.22 level after an earlier failed attempt to break higher. In these moments, the pair is operating at 93.27/32, up +0.18%.
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Forex Flash: South Korea: A healthy household restructuring - Nomura

Nomura economist Young Sun Kwon notes that in 2012, households increased net savings and slowed debt growth to match income growth. He expects policies by the new government to support this restructuring.
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