Leveraged funds continue to buy into the stronger USD theme, increasing their net long USD positioning for the sixth consecutive weak. The USD3.7bn increase in USD positioning to USD23.4bn during the week was primarily against JPY, EUR and GBP.
Net short positioning in the JPY was increased by 19.3k contracts (USD2.2bn) to 91.2k for an overall short position of USD11.0bn. This is the highest net short positioning on JPY since December 2013.
Net short positioning in EUR was also increased by USD1.7bn (11.6k contracts). This was likely on the back of dovish comments from ECB President Draghi at the Jackson Hole symposium on 22 August, suggesting that further easing measures in the Eurozone has become more likely. Total net short positions now stand at USD21.6bn, the highest level since June 2012.
Net long positions in GBP continue to be reduced for the ninth consecutive week, falling by USD1.2bn (11.4k contracts). This is despite the Bank of England’s August Monetary Policy Committee meeting minutes (released on 20 August) revealing that 2 out of 9 members voted for an increase in the base rate by 25bps. It is likely that the upcoming Scottish referendum on 18 September is contributing to the GBP positions’ unwind.
Net long positioning in the AUD increased by 7.0k contracts (USD0.7bn) even as RBA Governor Stevens noted that the AUD/USD is still too high in his semi-annual testimony. Positioning in NZD on the other hand, has declined for the sixth consecutive week.
