Rabobank analysts assessed the latest CFTC Commitment of Traders Report and reported the below-seen highlights.
“USD speculators’ long positions grew for the fifteenth consecutive week. Broad-based support for the USD reflects heightened capital outflows from emerging markets and an indication from the FOMC that rates could be increased by a total of 4 times this year.”
“EUR positions plunged into negative ground. They have been retreating for a while on the guidance from the ECB that rates may not be raised until at least summer 2019. But last week’s positions dropped on fears of contagion from Turkey’s troubles.”
“GBP shorts continued to grow as fears over the chances of a hard Brexit tightened their grip. Brexit talks commenced again last week but brought little fresh news.
Net JPY short positions retreated further last week. Although fears of trade wars has not triggered much safe haven demand for the JPY in recent months, contagion stemming from Turkish events has lent moderate support.”
“CHF net shorts edged lower last week, but remained essentially consolidative. The SNB remains committed to ultra-accommodative policy and this has been diverting safe haven flow related to this year’s sell off in EM currencies into the USD.”
“CAD shorts continued to drop. The rift with Saudi has weighed but commodity prices and NAFTA talks remain in view. AUD shorts dropped back having increased to their largest levels since October 2015 the previous week. US/China trade tensions have weighed on confidence, the RBA remains cautious on its policy outlook and domestic politics is also in view. NZD shorts increased last further week on the back of the RBNZ’s dovish tone.”