In this week’s issue:

Trades for the ‘Carney moments’ inlife

–    GBP's ‘Carney moment' seems to be behind us.Tailwinds from BoE hikes may not be enough to offset growing downside risks.Investor concerns about Scottish referendum in September,General Elections next May and, potential, EU referendum and ‘Brexit’ couldweigh on GBPUSD and fuel FX implied volatility. Long-end cable vols lookattractive.

–    Yellen's 'Carney moment' may arrive later thisyear. Indications that the Fed is ready to remove stimulus can support USDagainst a range of currencies including GBP and EUR going into yearend. Withcorrelation between GBPUSD and EURUSD having fallen considerably, 3-6m DualDigitals to exploit downside in both pairs could be attractive.

G10 Week Ahead – Inflation, BoEminutes, Ifo and RBNZ

A hawk feather on a dove

–    Fed Chair Yellen’s testimony came and went withoutmuch fanfare and market reaction. Markets were served a reminder/warning thatrate hikes could happen sooner than expected, though still waiting for datastrong enough to sway the Fed’s center. While normally this would call for thepro-carry environment to persist, geopolitical tensions have resurfaced andwill drive markets in the short term.

Asia – Korea: What’s up with thewon?

CEEMEA – South Africa: SARB MPC

Latam – No change is the new dove