U.S. dollar net long bets jump to largest since mid-June 2019 -CFTC, Reuters data By Reuters
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By Gertrude Chavez-Dreyfuss
NEW YORK (Reuters), U.S. Dollar net longs rose to the highest point in two years in the most recent week, according to Reuters calculations.
In the week ending Oct. 5, the value of the net-long dollar position reached $22.89 trillion, compared to $16.37 billion the week before. After being net short for 16 consecutive months, the U.S. dollar position has now been net long 12 weeks in a row.
U.S. dollar position was calculated from net contracts in international Monetary Market speculators for the Japanese yen and euro as well as Canadian and Australian dollars.
A wider measure of dollar position, including net contracts on the New Zealand Dollar, Mexican Peso, Brazilian Real, and Russian Ruble, shows that the greenback has a net long position at $22.535 billion, up from $15.33 trillion previously.
Dollar has been on the rise since September 21-22 Federal Reserve Monetary Policy Meeting that suggested possible tapering in Fed asset purchases, starting November of this year and ending June 2022.
Because the Fed will buy less assets of debt, tapering tends to be dollar positive. This means there will be fewer dollars in circulation which makes the currency more valued.
The index has more than doubled since September’s meeting.
However, Friday’s disappointing U.S. nonfarm payrolls report saw the dollar pull back. According to data, the U.S.’s nonfarm payrolls grew by 194,000 jobs in August, which was higher than what had been expected for 500,000. However, August data was updated to reflect that 366,000 new jobs were created rather than the 235,000 previously reported.
According to Capital Economics, Jonathan Petersen (markets economist at Capital Economics), “U.S. Inflation Data Released Next Wednesday May Add To Evidence That Inflationary Pressures Are proving Less ‘Transitory’ Than Generally Accused,” Capital Economics published its most recent research note.
Our view is that these will drive U.S. yields higher and the dollar slightly higher over the next months.
The euro position in other contracts turned short last week. It now has net short contracts totalling 22,334, down from 872 net long positions the previous week. Due to the dovish European Central bank’s stance, the euro is still a trailblazer among G10 currencies.
From net short contracts totaling 883 in the previous week, the bitcoin market saw net shorts of 1,518 contracts for the week that ended October 5. These net short bitcoin contracts were the most significant since late July.
Bitcoin rose to $56,168 Friday on the back of continued institutional demand. This helped it gain legitimacy with investors.
Bitcoin has experienced an 87.5% increase since June’s low at $28,600.
Japanese Yen (Contracts up to 12,500,000 yen).
$7.144 trillion
Prior Week 05 October 2021
Week
Long 31,569 35.328
Short 95 263 100,088
Net -63.694 -64.760
EURO (Contracts up to 125,000 euro)
$3.237 trillion
Prior Week 05 October 2021
Week
Long 196.819 195.043
Short 219 153 194,171
Net -22.334 872
POUNDSTERLING (Contracts for 62,500 Pounds Sterling)
$1.75 billion
Prior Week 05 October 2021
Week
Long 48.137 57.923
Short 68.155 55.959
Net -20.018 1.964
SWISSFRANC (Contracts for 125,000 Swiss Francs
$2.113 Billion
Prior Week 05 October 2021
Week
2274, 6,734
Short 17953 18321
Net -15.679 -11.587
CANADIAN DOLLAR – Contracts worth 100,000 Canadian dollars
$2.135 trillion
Prior Week 05 October 2021
Week
Long 18,580 21873
Short 45,446 41,108
Net -26.866 -20.235
AUSTRALIAN DOLLAR (Contracts up to 100,000 Dollars)
$6.56 trillion
Prior Week 05 October 2021
Week
Long 17,471 18407
Short 107.450 104.790
Net -89.979, 86.383
MEXICAN PESO (Contracts worth 500,000 pesos
$0.866 billion
Prior Week 05 October 2021
Week
Long 77.074 92.423
Short 112,653 12,018
Net -35 579 -19,595
NEW ZEALAND DOLLAR (Contracts for 100,000 New Zealand Dollars)
$-0.561 Billion
Prior Week 05 October 2021
Week
Long 17,887 18,324
983 1 8078
Net 8.056 10.246
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