USD longs reduced, EUR longs gained - ANZ

Leveraged funds were net sellers of the USD for the fourth consecutive week in the lead up to the June FOMC meeting according to the CFTC positioning data for the week ending 13 June 2017, notes the analysis team at ANZ.

Key Quotes

“Overall net long USD positions were reduced by USD2.4bn to USD9.2bn, the lowest net longs since February this year. With the FOMC dot plots still signalling one more hike this year and the possibility of balance sheet reduction later this year, positioning is likely to be more sensitive to the US data pulse.”

“Dollar selling was mostly broad-based except against the GBP. The UK election result, which produced a hung parliament, saw GBP weaken. Leveraged funds increased their net short GBP position by USD0.6bn to USD1.3bn. This is the third consecutive week of net GBP selling.” 

“Leveraged funds turned net long EUR for the first time since May 2014. Net buying worth USD1.0bn in the week has seen overall EUR positions turn from net short of USD0.1bn to a net long position of USD0.9bn. Funds reduced their net short JPY positions by USD0.8bn to USD2.4bn. This came after six straight weeks of net JPY selling.”

“All three commodity currencies saw net buying in the week, to the tune of USD0.3bn each. As a result, net CAD and AUD short positions are at their lowest in five and four weeks, respectively. Net NZD long positioning increased to USD0.3bn, the highest since March this year.” 

“Overall net long positioning in EM currencies continues to rise. The combined net long positions in MXN, BRL and RUB totalled USD3.2bn, an increase of USD0.3bn in the week. This is the largest net long position since May 2013.”

“Net short 3m Eurodollar contracts were cut to the lowest since October 2016, by 434.1k contracts. Meanwhile, net longs in crude oil and gold were reduced after three consecutive weeks of net buying.”