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Based on the Commodity Futures Trading Commission (CFTC) data for the week ended on August 13, the Australia and New Zealand Banking Group (ANZ) recently anticipating market positioning to remain volatile while saying that the leveraged funds turned a net US Dollar (USD) buyer but asset managers did the opposite, turning into a net USD seller.

Key quotes

  • US-China trade developments will remain a key focus but the upcoming Annual US Federal Reserve Symposium at Jackson Hole will also be closely watched for the latest thinking of the central bank given the inversion of the UST curve and the unprecedented fall in 30Y UST yield.
  • Leveraged funds’ USD buying was mostly against EUR and commodity currencies, while they were a net buyer of JPY and CHF (suggesting a return of risk aversion), GBP and EM currencies.
  • For asset managers, their USD selling was dominated by significant buying of EUR, followed by GBP, JPY and CHF, while selling commodity and EM currencies.
  • Both funds and asset managers were overall net sellers, led by CAD. Funds also sold AUD but they pared their net NZD shorts. Money managers sold NZD while keeping their net AUD shorts broadly unchanged. On EM FX, funds were a net buyer while asset managers were a net seller, with both remaining overall long in EM FX.