“Last week's yen buying was mostly driven by hedge funds, who engaged in their biggest round of USDJPY selling since late-September 2012, though for the most part they remain interested in playing the upside as so far this year 'buying weeks' have outnumbered the opposite flow.” Notes Research Analysts Gareth Berry and Geoffrey Yu at UBS.
In addition, the GBP/USD was also a standout mover and there was no surprise in the overall direction. Gross selling was the fourth largest on record as all client categories largely capitulated. Hedge funds were marginal sellers, adding to their structural shorts, though asset manager selling was the third largest on record, and even private wealth clients bailed out of sterling in size on a comparative basis. “In terms of the daily breakdown, even though some damage was done on Wednesday with the release of the BoE minutes, asset managers did the bulk of their selling on Friday, which suggests that the downgrade may have triggered some benchmark-related selling.” The analysts add.






