© Reuters. FILE PHOTO: A packet of U.S. five-dollar payments is inspected on the Bureau of Engraving and Printing in Washington March 26, 2015. REUTERS/Gary Cameron
By Gertrude Chavez-Dreyfuss
NEW YORK (Reuters) – Speculators’ internet lengthy positioning on the U.S. greenback within the newest week soared to its highest stage since mid-June 2019, in line with calculations by Reuters and U.S. Commodity Futures Buying and selling Fee information launched on Friday.
The worth of the web lengthy greenback place was $23.99 billion for the week ended Nov. 30, up from internet longs of $22.11 billion within the earlier week. U.S. greenback internet lengthy positioning rose for a second straight week.
U.S. greenback positioning was derived from internet contracts of Worldwide Financial Market speculators within the Japanese yen, euro, British pound, Swiss franc, in addition to Canadian and Australian {dollars}.
In a broader measure of greenback positioning, which incorporates internet contracts on the New Zealand greenback, Mexican peso, Brazilian actual and Russian rouble, the dollar posted a internet lengthy place of $24.435 billion this week, from $21.964 billion within the prior week.
U.S. greenback internet longs elevated after Federal Reserve Chair Jerome Powell delivered hawkish testimonies early this week regardless of the emergence of the highly-transmissible Omicron coronavirus variant.
“In opposition to all of the currencies lined on this report, solely the yen noticed an enchancment in its place towards the greenback as buyers probably turned to its security amid heightened danger aversion with the unfold of the Omicron COVID-19 variant,” mentioned Scotiabank in its report after the discharge of the CFTC information.
Web shorts on the Japanese yen declined to 78,866 contracts this week.
In remarks earlier than Congress, Fed’s Powell mentioned the chance of inflation had elevated and steered retiring the time period “transitory” to explain the surge in costs. He additionally pushed for accelerating the tapering of Fed asset purchases.
The hit its highest stage since July 2020 final week, earlier than ending broadly unchanged this week.
Jane Foley, head of FX technique, at Rabobank in London, mentioned it could be troublesome for the greenback to put up additional positive aspects.
“Though Powell’s hawkish tone this week introduced again the chance that the Fed may hike charges twice subsequent 12 months, the market is already priced for this,” she added.
In cryptocurrencies, bitcoin futures’ internet brief positions ballooned to 1,691 contracts, after falling as little as 160 contracts final week, the smallest since mid-January 2019.
As with many danger belongings, bitcoin has been affected by worries in regards to the Omicron variant.
Since its all-time excessive of $69,000 hit on Nov. 10, bitcoin has dropped greater than 25%, with some market members suggesting that the world’s largest cryptocurrency has entered a bear market.
On Friday, bitcoin hit its lowest stage since Oct. 10 and was final down 4.7% at $53,897.
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