The net short USD position widened to $6bn, with only CAD andJPY still held net short and AUD, NZD, MXN, EUR, GBP and CHF allheld net long. Over the last few weeks, positioning changes havebeen relatively minor.
The net CAD position was flat w/w at -$3bn. CAD traders continueto pare back short exposure (with the gross short narrowing tothe smallest position since November 2013) but there has yet tobe any increase in bullish sentiment, leaving the overarchingtheme as CAD negative. Overall changes to the commodity currencieswere minor this week leaving an ongoing divergence betweenbullish net long positions in AUD and NZD and the bearish netshort CAD position
EUR has retaken the lead as the largest net long vs the USD,with a $1.2bn w/w build to $5.7bn. However, much of this mayhave already been reversed, considering the two-day decline inEUR.
A divergence between GBP sentiment (3 week deterioration) andspot is a cause for concern given the recent succession of multiyearhighs. This appears to be shifting given the 3-day fall in GBP.
Bearish sentiment toward JPY has moderated to levels not seensince October—just shy of the upper end of the one year range(see bottom right p2) — following this week’s $1.1bn narrowing inthe net short position to $7.5bn.
Read the full report: FX Research
Scotiabank