USD/INR: Options market turns most bearish in six weeks

One-month risk reversal (RR) of the USD/INR, a measure of the spread between call and put prices, not only drops for the first time in four days but also marks the heaviest fall since December 15, according to data source Reuters. 

A call option gives the holder the right but not obligation to buy the underlying asset at a predetermined price on or before a specific date. A put option represents a right to sell. 

That said, the daily difference between them slumps to -0.1000 versus the previous day’s reading of +0.013. It’s worth noting that the weekly RR drops for the third time in a line, to -0.013 at the latest.

Amid these plays, USD/INR consolidates losses around the lowest level since November 24, up 0.10% intraday near 74.56.