According to Shuaib Chowdhary, Strategist at Deutsche Bank, IMM data suggests that investors reduced their long dollar exposure, with implied USD longs as a fraction of open interest falling from 14% to 12%.
Key Quotes
“Investors significantly reduced their short EUR positions with shorts at their lowest level in almost three years. GBP shorts also continued to be pared over the past week. Meanwhile, speculators extended their short exposure moderately in both JPY and CHF. Among the dollar bloc currencies, investors pared short NZD positions by a fifth while extending bearish positions in CAD by a tenth. Long AUD positioning was unchanged. Speculators reduced their long MXN exposure modestly.”
“According to the TFF report, leveraged funds cut their long dollar positions by a quarter while asset managers extended their shorts by almost 40%. Sentiment improved in EUR, with leveraged funds reducing shorts by a third and asset managers extending their longs considerably.”
“In GBP, both communities reduced their short positions significantly. In JPY, leveraged funds pared their long positions by 50% while asset managers' short positioning was largely unchanged. Among the dollar bloc currencies, leveraged funds pared long AUD positions moderately and increased their short exposure in NZD by more than 50%. Asset managers reduced their long AUD positioning by half, while paring their short NZD positions by about a third. Asset managers' long CAD positioning flipped to short while leveraged funds kept their short exposure unchanged. Elsewhere in MXN, leveraged funds pared their longs while asset managers' long exposures remained firm.”
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