• Markets almost unanimous at 97.3% that Reserve Bank Australia rates will remain unchanged at 4.35% Tuesday

• There's unlikely to be any related AUD/USD volatility according to FX option market pricing

• Overnight expiry implied volatility little changed around the recent 11.0 average - premium/break-even 32 USD pips

• Broader AUD/USD implied volatility is slower to ease than related peers - 1-month 7.35 to 8.25 last week and now 8.0

• AUD/USD is higher as the US/Iran deal weighs USD and risk appetite recovers - reaches new high since June 5 at 0.7088

• Close above 100-dma 0.7085 would aid bulls, but the thickening 0.7065-.7164 daily cloud is resistance

• Massive FX option expiry near the days high - A$1.6 billion 0.7075-85 strikes roll off at 10-am New York cut expiry

• Related - FX market may be underpricing BoJ risk to USD/JPY
AUD=D3 daily chart


Overnight expiry AUD/USD FX option implied volatility


AUD/USD FXO implied volatility


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