US dollar short positions exceeded long ones last week for the first time in more than two years, according to the latest Commitment of Traders Report by Rabobank. The improvement of the market sentiment and US dollar liquidity seem to have weighed on US dollar demand.
Key quotes
“Following the recent trend, USD net positions fell into negative territory last week for the first time since May 2018 as improved market sentiment and dollar liquidity continued to impact.”
“EUR net longs leaped higher last week to their strongest levels since May 2018. Last month the single currency found support from the European Commission’s proposal for a recovery fund for the region which incorporates grants as well as loans.”
“Net short GBP positions continued to drop from their recent highs having moved back almost to their November 2019 at the start of the month as Brexit fears increased and as criticism grew as to the UK government’s handling of the coronavirus crisis.”
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