• EUR/USD holds low 1.12s, yet dealers report renewed demand for downside strikes this week

• 1-month 25-delta risk reversal back to 0.45 favouring EUR puts, after sliding from 0.9 to 0.25 last week

• French debt worries and gas above €90/MWh, a first since Dec 2022, keep pressure on the euro despite softer USD

• Topside demand largely absent: little appetite for EUR calls, while 1-month implied vol regained 6.5 from 6.1 this week

• 6-month vol should stay supported vs shorter tenors since including April's French election first round this week
EUR/USD FXO implied volatility


EUR/USD 25 delta risk reversals-

(Richard Pace is a Reuters market analyst. The views expressed are his own)