• Trumps tariff see-saw has seen USD/CAD options up and down this week

• Thursday's reiteration of March 4 deadline boosted premiums back to highs

• However, implied volatility still below highs before initial Feb. 4 deadline

• 1-week regains Wed's 10.0 peak from 7.0 early Thurs but does now include NFP

• 1-month regains 7.65 from 7.1. 1-wk and 1-mth were 13.5 and 9.5 on Feb. 3

• Risk reversals almost matching Feb. 3 long term high for CAD puts vs calls

• Pricing shows market primed for more volatility and focus on USD/CAD topside
USDCAD RISK REVERSALS


1-week and 1-month expiry USD/CAD option implied volatility

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