• UK CPI beat expectations but subsequent GBP/USD gains struggled above 1.2200

• Hedge flows from massive £2.7-billion 1.2200-15 strike expiries capped

• £1.3-billion 1.2140-60 Thursday can underpin. CPI risk premiums pared

• FX option implied volatility slips, less reason to hold protection post CPI

• 1-week expiry implied vol sold 8.5-7.7 and 1-month 8.4-8.3 post CPI

• Sales of Overnight implied vol too - especially 1.2140-50 strikes at 10.5

• However, trade flows still show concerns about an eventual 1.2000 test/break

• USD call options with RKO triggers can hedge that scenario nL1N3BN0PU

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