• Broader FX option volatility surges amid risk aversion/USD gains

• 1-week GBP/USD implied volatility trades 8.0, 1-month 7.35 - highs since Jan

• 1-month up from 6.8 Monday and post Brexit lows 5.4 mid March

• Risk reversal vol premium for USD calls over puts doubles to high since July

• Shows GBP/USD traders are more wary of GBP/USD downside vs upside

• Cable drops to 1.2409 (5-month low) after disappointing UK jobs data Tues

• Traders alert for UK CPI Wednesday - headline f/c 3.1% vs 3.4% prior

• Overnight expiry implied volatility holds firmer levels around 12.5

• Premium/break-even for straddle is 65 USD pips in either direction

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