CFTC positioning data: net buyers of dollars - ANZ

Analysts at ANZ offered the CFTC positioning data for the week ending 16 May 2017.

Key Quotes:

"Leveraged funds were net buyers of USD for the second straight week, adding USD2.9bn to take their overall net long position to USD16.5bn. This was despite weak DXY price action during the week, caused by weaker than expected US economic data and negative political headlines. Given the weakness in the DXY into last week’s close, we could see an unwinding of recent long dollar positions.

For the second week running, dollar buying was concentrated against the yen. Funds were net sellers of JPY to the tune of USD2.5bn, taking their overall net short position to USD2.7bn, the highest in eight weeks. Funds also added to their net short CHF positions by USD0.6bn after two consecutive weeks of net buying·         

Commodity currencies continued to struggle for the fourth straight week with a combined net selling of USD2.1bn. With USD1.1bn of net selling, CAD led the pack (see attached pdf Figure 9). Meanwhile, funds cut their net long AUD positions by USD0.9bn, bringing it down to USD0.1bn (see attached pdf Figure 10). The strong Australian jobs report after the cut-off date could see some consolidation in AUD longs in the week ahead. Meanwhile, the NZD continued to see marginal selling of USD0.1bn in the week.

EUR and GBP saw net buying for the fourth and fifth consecutive week, respectively. Funds reduced their net short EUR position by USD1.8bn to USD5.1bn, the lowest in a year. Overall net short GBP positions were halved to USD0.5bn, the lowest since June 2016.

EM currencies reversed last week’s net selling. All three currencies (MXN, BRL and RUB) saw modest buying during the week.

 Funds reduced their net 3M Eurodollar shorts by 364.8k contracts after reaching record highs in the previous week (see attached pdf Figure 15).Meanwhile, net long crude oil and gold positions fell for the fourth consecutive week despite a pick-up in prices. However, a further recovery in prices post the cut-off date on a weak dollar could see some reversal in positioning in the next few weeks."