Derivs - FX

Investors have been buying short-dated options on the euro and US dollar against the Canadian dollar, as the Canadian unit has continued to strengthen over recent days following the announcement that Burger King will buy Canadian fast food chain Tim Hortons.

Investors have increasingly been buying options on the euro against both the dollar and sterling, as market participants expect further volatility to occur in the single currency following comments from European Central Bank president Mario Draghi at last week’s annual symposium in Jackson Hole.

Some market participants have been unwinding long options positions on the dollar against the yen in a bid to take profit as the Japanese unit has steadily weakened against the greenback. At the end of last month, $/¥ was trading at 101.36. On Monday, spot on the pair was 104.28.

Andrew Simpson, ex-coo at Rate Validation Services, has been appointed head of post-trade at Euronext as the exchange operator makes a push to expand its post-trade services following a demerger with parent company IntercontinentalExchange earlier this year. Simpson will be responsible for developing Euronext’s relationship with LCH.Clearnet and its clearing strategy for both cash and derivatives markets.

Investors have been selling puts on the euro against the dollar in a bid to take profit on any downside options they still hold, following a further decline in spot on the currency pair after somewhat hawkish Federal Open Market Committee meeting minutes were released on Wednesday.

Global financial regulators have questioned the effectiveness of data protection and state secrecy laws in relation to trade reporting of over-the-counter derivatives.

Investors have been trading vanilla options on the euro against the dollar this week, following the recent spot decline in the currency pair.

Simon Winn, ex-head of sales for Asia at 360T, has joined ICAP’s EBS business as head of sales Asia Pacific, based in Hong Kong.

Traiana has expanded its post-trade cross-asset allocation services for buy- and sell-side clients with a new service called Harmony Securities. The service has been designed to meet new processing requirements and regulatory changes such as T+2 settlement.

Market participants have been trading downside options on the sterling against the US dollar ahead of Wednesday’s inflation report from the Bank of England.

Chinese corporates have rushed to take advantage of a recent change to regulations governing their use of currency derivatives, with domestic and international banks lining up to announce deals for clients under the new rules. This new liberalisation, which took effect on August 1, is a big step in the development of China’s FX market, bankers have told GlobalRMB.

One leading interdealer broker in London this week bought a €1bn euro call on the euro/Swiss franc exchange rate in anticipation of the Swiss National Bank (SNB) raising the enforced Sfr1.20 ($1.32) floor on the rate to Sfr1.25 in a bid to combat deflation.