Make Kitco Your Homepage

UPDATE 1-Speculators boost bearish bets on U.S. dollar

Kitco News

(Adds details, comments, table, byline)

By Saqib Iqbal Ahmed

NEW YORK, Jan 12 (Reuters) - Speculators' net short dollar bets rose in the latest week to the largest position since mid-October, according to calculations by Reuters and Commodity Futures Trading Commission data released on Friday.

The value of the net short dollar positions, derived from net positions of International Monetary Market speculators in the yen, euro, British pound, Swiss franc and Canadian and Australian dollars, was $8.85 billion, in the week to Jan. 9.

That compares with a net short position of $4.62 billion the previous week. To be short a currency means traders believe it will fall in value.

In a wider measure of dollar positioning that includes net contracts on the New Zealand dollar, Mexican peso, Brazilian real and Russian ruble, the U.S. dollar posted a net short position valued at $10.14 billion, compared with $5.43 billion the week before.

The dollar index , which measures the greenback against six rival currencies, fell to a three-year low of 90.934 on Friday. The index ended 2017 down nearly 10 percent, its worst annual showing since 2003.

Concerns about economic growth and political stability have hurt the U.S. dollar and continue to weigh on its outlook, Alfonso Esparza, senior currency analyst at OANDA in Toronto, said.

Investors are also paying close attention to the inflation scenario, which so far has been lackluster, Esparza said.

The U.S. central bank's preferred inflation measure, the personal consumption expenditures price index excluding food and energy, has missed its target since May 2012.

The net long position in the euro grew to 144,691 contracts, a fresh record, the data showed.

On Friday, the euro surged to a more than three-year high against the dollar on hopes that European Central Bank policymakers are preparing to reduce their vast monetary stimulus program. The net long position on sterling grew to the largest since September 2014.

Sterling on Friday rose to its highest level against the dollar since the vote to leave the European Union, after a report that the Netherlands and Spain were open to a deal for Britain to remain as close as possible to the trading bloc. Meanwhile, speculators' net short position on bitcoin Cboe futures rose to 1,907 contracts this week, the data showed.

South Korea's government said on Thursday it plans to ban cryptocurrency trading, sending bitcoin prices plummeting and throwing the virtual coin market into turmoil as the nation's police and tax authorities raided local exchanges on alleged tax evasion. Japanese Yen (Contracts of 12,500,000 yen) $13.556 billion

09 Jan 2018 Prior week

week Long 37,376 39,592 Short 162,912 161,358 Net -125,536 -121,766 EURO (Contracts of 125,000 euros) $-19.271 billion

09 Jan 2018 Prior week

week Long 242,053 236,808 Short 97,362 108,940 Net 144,691 127,868 POUND STERLING (Contracts of 62,500 pounds sterling) $-1.379 billion

09 Jan 2018 Prior week

week Long 85,039 93,611 Short 59,547 77,376 Net 25,492 16,235 SWISS FRANC (Contracts of 125,000 Swiss francs) $2.089 billion

09 Jan 2018 Prior week

week Long 18,523 24,984 Short 40,445 41,216 Net -21,922 -16,232 CANADIAN DOLLAR (Contracts of 100,000 Canadian dollars) $-1.178 billion

09 Jan 2018 Prior week

week Long 58,581 49,297 Short 41,120 34,558 Net 17,461 14,739 AUSTRALIAN DOLLAR (Contracts of 100,000 Aussie dollars) $1.568 billion

09 Jan 2018 Prior week

week Long 52,347 45,175 Short 46,889 65,201 Net 5,458 -20,026 MEXICAN PESO (Contracts of 500,000 pesos) $-0.897 billion

09 Jan 2018 Prior week

week Long 78,703 93,804 Short 48,906 58,746 Net 29,797 35,058 NEW ZEALAND DOLLAR (Contracts of 100,000 New Zealand dollars) $1.206 billion

09 Jan 2018 Prior week

week Long 17,304 15,509 Short 28,321 32,494 Net -11,017 -16,985 (Reporting by Saqib Iqbal Ahmed; Editing by Lisa Shumaker and Susan Thomas)

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.