Risk recovery takes option implied volatility cautiously lower, but uncertainty over the Omicron variant, central bank meetings and year-end liquidity are limiting deeper declines in shorter dated and front-end expiry premiums. GBP/USD options continue to flag downside caution - GBP put implied volatility premiums on risk reversals spending many weeks close to post-Brexit highs. That"s supporting implied volatility as GBP suffers - 1-month paid 7.5-7.65 Wednesday. EUR/USD flirts with 1.1300, but option flows still highlight interest to buy downside protection at the cheaper levels presented by higher spot and lower implied volatility and EUR put premiums. read more USD/JPY curve basically flat after 1-month traded 7.2 from Fridays 7.95 peak and 1-month risk reversals back at 0.85 after spiking 0.2 to 1.9 for JPY calls as USD/JPY fell to mid 112"s last week. Focus on topside strikes, especially post U.S. CPI to benefit from related volatlity. AUD/USD recovery helped by risk appetite and mildly hawkish RBA on Tuesday. One-month implied volatility has fallen 1.0 vol from last week"s peak, AUD put premiums are receding and end-users are reportedly selling downside strikes. Benchmark 1-month expiry FX option implied volatility GBP/USD 1-3-month expiry FX option risk reversals USD/JPY 1-month expiry 25D risk reversals 1-3-month expiry EUR/USD option risk reversals For more click on FXBUZ Richard Pace is a Reuters market analyst. The views expressed are his own Our Standards: The Thomson Reuters Trust Principles.