Speculators' net short dollar bets rose to their largest in roughly more than a month, according to calculations by Reuters and Commodity Futures Trading Commission data released on Friday. The value of the net short dollar positions, derived from net positions of International Monetary Market speculators in the yen, euro, British pound, Swiss franc and Canadian and Australian dollars, was $3.93 billion in the week ended November 28.
That was higher than the previous week's net short position of $3.15 billion. The dollar net shorts rose for a second straight week. Speculators have been short the greenback for 20 straight weeks. 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 short position valued at $6.213 billion this week, from $5.23 billion previously. The dollar ended the week on a slightly positive note, with the index up 0.1 percent given strong US economic data this week.
"The data largely confirmed the view that the world's largest economy increased momentum as it entered the final months of 2017," said Omer Esiner, chief market analyst, at Commonwealth FX in Washington. The reports also largely kept alive expectations the Federal Reserve will likely continue to normalize US monetary policy at a steady and gradual pace, he added. But gains would have been much higher this week had it not for the ABC report saying former adviser Michael Flynn was prepared to testify that Trump directed him to make contact with the Russians when he was a presidential candidate.
Amid the Flynn news, the "dollar appeared to be marking time ahead of both the US tax reform outcome and the Fed's next pivotal meeting in mid-December," said James Chen, head of research at Forex.com in Bedminster, New Jersey. Yen shorts, meanwhile, declined to 110,640 contracts, the smallest since mid-October.