Currency speculators further reduced bets against the US dollar for a second straight week, although net short positioning was still at extreme levels, data from the Commodity Futures Trading Commission showed on Friday. The value of the dollar's net short position fell to $25.8 billion in the week ended October 19, compared to a net short of $29 billion the previous week, according to Reuters and Commodity Futures Trading Commission calculations.
Net short dollars totalled about $30 billion two weeks ago, the biggest bet against the greenback since at least June 2008. The most significant change in the latest week was in the Australian dollar, Canadian dollar and New Zealand dollar, with net longs substantially cut. In the case of the Canadian dollar, specs pared net longs by about 13,000 contracts following a dovish message from the Bank of Canada on Tuesday. "Overall, today's report suggests that markets may be pulling back on risk with the FOMC decision drawing nearer," said Shaun Osborne, chief currency strategist at TD Securities in Toronto.
"We expect that trend to continue next week, as there is so much uncertainty around what exactly the Federal Reserve will announce, and how markets will react." The Reuters calculation for the aggregate US dollar position is derived from the net positions of International Monetary Market speculators in the Japanese's yen, euro, British pound, Swiss franc, Canadian dollar and Australian dollar.
Comments
Comments are closed.