According to the CFTC’s positioning data for the week ending 7 May 2019, leveraged funds remained USD buyers, extending their long USD positions, but asset managers turned USD sellers, adding to their net USD shorts.
Key Quotes
“Post the CFTC cut-off date, DXY lost ground on weak US inflation data, while US-China trade talks continued to hang in balance. Looking ahead, we expect USD positioning to be driven by further developments in the trade talks, their impact on the US economy and Fed policy.”
“Funds’ USD buying was mostly against EUR and GBP, while asset managers sold USD against these two currencies. That said, both funds and asset managers were net JPY buyers, reflecting growing risk aversion. Going forward, with heightened US-China trade tension, safe-haven currencies like JPY and CHF could gain further ground.”
“Commodity currencies saw funds pare their combined shorts and asset managers extend their shorts, but most of the position changes were in CAD. On AUD and NZD, funds trimmed their AUD shorts while selling NZD. Money managers kept their AUD and NZD shorts broadly unchanged.”
“Looking ahead, AUD and NZD positioning will hinge on central bank policy outlook as well as US-China trade talks. On EMFX, funds pared their longs while asset managers extended their longs.”
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