lundi 6 avril 2015
Traders cut bets against yen to 2 1/2-year low
Posted on 15:07 by nice news
Currency speculators have reduced their bets against the yen in the futures market to the lowest aggregate level in about two-and-a-half years, according to data from the Commodity Futures Trading Commission.
By cutting their short positions, traders have acknowledged that the pace of the dollar’s rally—its fastest pace in 40 years, according to Citigroup’s Steve Englander—wasn’t entirely justified by economic fundamentals, and that the buck will likely continue to retrace some of its gains before resuming its upward trajectory, analysts said.
The value of net shorts against the yen has fallen to $2.5 billion in the week ended March 31, its lowest level since October 2012, down from $10 billion in mid-January, and $13.8 billion the week of Sept. 30, 2014.
“I think really what it reflects is that there hasn’t been a catalyst to drive the U.S. dollar higher,” said Camilla Sutton, chief currency strategist at Scotiabank. “In a case like the yen, it has been sitting in a pretty narrow range since mid-December, and I think on the back of that, speculative positions are really petering out.”
The market still expects the Federal Reserve to raise interest rates before the end of the year. But recent economic data shows that the strong currency, harsh winter weather and low crude-oil prices have had a significant impact on growth in the U.S. That has complicated the narrative that the U.S. economy has recovered from the post-financial crisis recession faster than its peers—a narrative that has been the primary driver of the dollar’s rally since it began last summer.
Meanwhile, central banks around the world, including the Bank of Japan, continue to ease monetary policy by maintaining low interest rates, cutting them further, or buying assets.
Policy makers, once dismissive of the strong dollar’s impact on U.S. economic growth, now acknowledge it. On Monday, New York Federal Reserve President William Dudley
By cutting their short positions, traders have acknowledged that the pace of the dollar’s rally—its fastest pace in 40 years, according to Citigroup’s Steve Englander—wasn’t entirely justified by economic fundamentals, and that the buck will likely continue to retrace some of its gains before resuming its upward trajectory, analysts said.
The value of net shorts against the yen has fallen to $2.5 billion in the week ended March 31, its lowest level since October 2012, down from $10 billion in mid-January, and $13.8 billion the week of Sept. 30, 2014.
“I think really what it reflects is that there hasn’t been a catalyst to drive the U.S. dollar higher,” said Camilla Sutton, chief currency strategist at Scotiabank. “In a case like the yen, it has been sitting in a pretty narrow range since mid-December, and I think on the back of that, speculative positions are really petering out.”
The market still expects the Federal Reserve to raise interest rates before the end of the year. But recent economic data shows that the strong currency, harsh winter weather and low crude-oil prices have had a significant impact on growth in the U.S. That has complicated the narrative that the U.S. economy has recovered from the post-financial crisis recession faster than its peers—a narrative that has been the primary driver of the dollar’s rally since it began last summer.
Meanwhile, central banks around the world, including the Bank of Japan, continue to ease monetary policy by maintaining low interest rates, cutting them further, or buying assets.
Policy makers, once dismissive of the strong dollar’s impact on U.S. economic growth, now acknowledge it. On Monday, New York Federal Reserve President William Dudley
Traders cut bets against yen to 2 1/2-year low
Categories: Traders cut bets against yen to 2 1/2-year low
Inscription à :
Publier les commentaires (Atom)
0 commentaires:
Enregistrer un commentaire