September 20, 2019 / 7:55 PM / 25 days ago

Speculators up net long U.S. dollar bets to 5-week high: CFTC, Reuters

NEW YORK (Reuters) - Speculators boosted their net long bets on the U.S. dollar in the latest week to a five-week high, according to calculations by Reuters and Commodity Futures Trading Commission data released on Friday.

FILE PHOTO: A trader shows U.S. dollar notes at a currency exchange booth in Peshawar, Pakistan December 3, 2018. REUTERS/Fayaz Aziz

The value of the net long dollar position was $15.29 billion in the week ended Sept. 17. The net long dollar position had stood at $13.33 billion last week.

To be long a currency means traders believe it will rise in value, while being short points to a bearish bias. U.S. dollar positioning was derived from net contracts of International Monetary Market speculators in the Japanese yen, euro, British pound, Swiss franc and Canadian and Australian dollars.

In a wider measure of dollar positioning NETUSDALL= that includes net contracts on the New Zealand dollar, Mexican peso, Brazilian real and Russian ruble, the greenback posted a net long position of $15.40 billion in the week ended Sept. 17, compared with $12.58 billion the previous week.

On Friday, the U.S. dollar rose against a basket of currencies and it posted its first weekly increase in three, helped by hopes that the Federal Reserve would not lower rates aggressively.

Against a favorable economic backdrop, the Fed lowered key lending rates by a quarter point on Wednesday, but signaled a higher bar to further reductions in borrowing costs.

Interest rates futures implied traders saw a 63% chance of another rate cut by year-end, compared with 69% late on Thursday, CME Group’s FedWatch program showed.

While interest rate cuts typically weaken the U.S. dollar, because investors often swap dollars for foreign currencies to take advantage of better interest rates in other countries, the recent Fed rate cuts have done little to hurt the greenback.

The strength of the U.S. economy relative to the rest of the world and low interest rates around the globe have led investors to favor the U.S. dollar.

Japanese Yen (Contracts of 12,500,000 yen)

$-2.759 billion

17 Sep 2019 Prior week

week

Long 50,842 56,579

Short 26,980 23,988

Net 23,862 32,591

EURO (Contracts of 125,000 euros)

$9.488 billion

17 Sep 2019 Prior week

week

Long 164,272 180,535

Short 232,831 230,377

Net -68,559 -49,842

POUND STERLING (Contracts of 62,500 pounds sterling)

$6.728 billion

17 Sep 2019 Prior week

week

Long 21,332 37,903

Short 107,456 130,136

Net -86,124 -92,233

SWISS FRANC (Contracts of 125,000 Swiss francs)

$0.574 billion

17 Sep 2019 Prior week

week

Long 15,125 16,087

Short 19,681 18,979

Net -4,556 -2,892

CANADIAN DOLLAR (Contracts of 100,000 Canadian dollars)

$-1.497 billion

17 Sep 2019 Prior week

week

Long 62,004 54,971

Short 42,181 43,448

Net 19,823 11,523

AUSTRALIAN DOLLAR (Contracts of 100,000 Aussie dollars)

$2.751 billion

17 Sep 2019 Prior week

week

Long 34,566 36,994

Short 74,648 90,008

Net -40,082 -53,014

MEXICAN PESO (Contracts of 500,000 pesos)

$-2.108 billion

17 Sep 2019 Prior week

week

Long 135,507 126,807

Short 53,881 31,170

Net 81,626 95,637

NEW ZEALAND DOLLAR (Contracts of 100,000 New Zealand dollars)

$2.291 billion

17 Sep 2019 Prior week

week

Long 15,824 22,490

Short 51,867 52,280

Net -36,043 -29,790

Reporting by Saqib Iqbal Ahmed; Editing by David Gregorio and Tom Brown

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