Speculators' net long bets on the US dollar rose for a second straight session, according to calculations by Reuters and Commodity Futures Trading Commission data released on Friday. The value of the net long dollar position was $23.17 billion in the week ended Sept. 25, up from $22.98 billion the previous week.
US dollar positioning was derived from net contracts of International Monetary Market speculators in the yen, euro, British pound, Swiss franc and Canadian and Australian dollars. In a wider measure of dollar positioning that includes net contracts on the New Zealand dollar, Mexican peso, Brazilian real and Russian ruble, the US dollar posted a net long position of $24.796 billion in the week ended Sept. 25, little changed from the $24.78 billion a week earlier.
The dollar's outlook has been enhanced by the Federal Reserve's interest rate hike early this week along with forecasts for multiple rate increases until 2020. In the run-up to the Fed decision on Wednesday, the dollar had weakened, with rate hikes for September and December factored in by the market and the outlook for 2019 uncertain.
That changed with the Fed decision on Wednesday and euro weakness amid worries about the Italian budget. "At the end of the day, the Federal Reserve is the only major central bank engaging in sustained interest rate increases, and until that dynamic starts to change, the greenback could maintain its recent strength," said Matt Weller, US senior market analyst at Faraday Research. In other contracts, sterling net shorts fell to -67,078 this week, from -79,258 previously, which was the largest since May 2017 amid concerns about negotiations over Britain's exit from the European Union.
The pound has been under pressure as investors' optimism for a Brexit trade deal has declined ahead of the ruling Conservative party's annual conference next week. In the cryptocurrency market, speculators' net short position on bitcoin Cboe futures slipped to 1,173 contracts in the latest week, from 1,318 thhe previous week, data showed Bitcoin on Friday rose 0.2 percent to $6,661.41 on the Bitstamp platform.
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