July 31, 2020 / 9:34 PM / 14 days ago

UPDATE 1-U.S. dollar net shorts soar to highest in nine years -CFTC, Reuters

 (Adds analyst comment, table)
    By Gertrude Chavez-Dreyfuss
    NEW YORK, July 31 (Reuters) - Speculators' net short U.S.
dollar positioning soared to the highest level since August
2011, according to calculations by Reuters and U.S. Commodity
Futures Trading Commission data released on Friday.
    The position hit $24.27 billion in the week ended July 28,
up from $18.81 billion the prior period. U.S. net shorts rose
for a fourth straight week as bets against the greenback have
persisted since mid-March.
    U.S. dollar positioning was derived from net contracts of
International Monetary Market speculators in the Japanese yen,
euro, British pound, Swiss franc as well as the 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 U.S. dollar posted a net
short position of $24.53 billion, compared with net shorts of
$19.37 billion the week before. This week's net short position
was largest since April 2018, according to Reuters data.
    In contrast, net euro longs hit a record high, CFTC data
showed. Net euro longs were 157,559 contracts this week.
    The greenback has struggled over the last few months, driven
by factors including near-zero interest rates as well as Federal
Reserve measures that flooded the international market with
dollars via swap lines. 
    The buck was down about 10% from the year's high hit in
March against a basket of currencies. On Friday the
dollar fell to its lowest in more than two years.
    "The combination of falling real rates and rising risk
assets has been a dominating force across markets over the past
few months, which has likely contributed to the dollar sell-off
over the same period," said Goldman Sachs in a research note on
Friday.
    The euro's outperformance kicked off in high gear when
European Union leaders a few weeks ago clinched a massive
stimulus plan that likely meant a less steep regional downturn.
    Since its March lows as the coronavirus pandemic forced
lockdowns across Europe, the euro has soared 12% versus the
dollar. 
    
Japanese Yen (Contracts of 12,500,000 yen) 
 $-3.391 billion
         28 Jul 2020            Prior week
         week             
 Long             62,924            50,854
 Short            34,417            31,547
 Net              28,507            19,307
 
EURO (Contracts of 125,000 euros)
 $-23.071 billion
         28 Jul 2020            Prior week
         week             
 Long            242,127           204,185
 Short            84,568            79,138
 Net             157,559           125,047
 
POUND STERLING (Contracts of 62,500 pounds sterling)
 $2.053 billion
         28 Jul 2020           Prior week
         week             
 Long             39,329           46,230
 Short            64,738           61,310
 Net             -25,409          -15,080
 
SWISS FRANC (Contracts of 125,000 Swiss francs)
 $-1.15 billion
         28 Jul 2020           Prior week
         week             
 Long             17,654           17,761
 Short             9,212           10,382
 Net               8,442            7,379
 
CANADIAN DOLLAR (Contracts of 100,000 Canadian dollars)
 $0.934 billion
         28 Jul 2020           Prior week
         week             
 Long             32,105           34,284
 Short            44,601           50,982
 Net             -12,496          -16,698
 
AUSTRALIAN DOLLAR (Contracts of 100,000 Aussie dollars)
 $0.359 billion 
         28 Jul 2020           Prior week
         week             
 Long             42,402           41,778
 Short            47,414           41,983
 Net              -5,012             -205
 
MEXICAN PESO (Contracts of 500,000 pesos)
 $-0.248 billion
         28 Jul 2020           Prior week
         week             
 Long             51,851           49,461
 Short            40,987           39,613
 Net              10,864            9,848
 
NEW ZEALAND DOLLAR (Contracts of 100,000 New Zealand dollars)
 $0.056 billion 
         28 Jul 2020           Prior week
         week             
 Long             17,383           19,597
 Short            18,228           17,122
 Net                -845            2,475
 
 (Reporting by Gertrude Chavez-Dreyfuss; Editing by Tom Brown
and Richard Chang)
  
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