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You have written a EUR/USD knock-in option for a bank counterparty. At 6pm New York time on Friday, the instrike point is breached. This is confirmed on screens. The counterparty contacts you to confirm that the option has been knocked in.
A. The deal is done. You should confirm with your counterparts.
B. If the knock-in is confirmed by a New York price source, the deal is done and you should confirm with your counterparty.
C. The recognised closing time for the currency markets is 6:00pm New York time in Friday, so the deal is done and you should confirm with your counterparty.
D. The recognised closing time for the currency markets is 5:00pm NewYork time in Friday, so no deal is done.
Answer: D
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