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U.S. net long dollars hit highest since late December: CFTC, Reuters

Published 03/08/2019, 05:01 PM
Updated 03/08/2019, 05:05 PM
© Reuters. Illustration photo of a U.S. Dollar note

By Gertrude Chavez-Dreyfuss

NEW YORK (Reuters) - Speculators boosted their net long U.S. dollar position to its highest level since late December, according to calculations by Reuters and U.S. Commodity Futures Trading Commission data released on Friday.

The value of the net long dollar position was $28.57 billion in the week ended March 5, compared with $23.84 billion the previous week. Net long dollar positioning has advanced for a fifth consecutive week.

U.S. dollar positioning was derived from net contracts of International Monetary Market speculators in the yen, euro, British pound, Swiss franc and Canadian and Australian dollars.

In a broader 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 long position of $25.352 billion in the week ended March 5, compared with $23.524 billion.

The dollar had gained some momentum over the last two weeks, bolstered mainly by stronger-than-expected U.S. second-quarter economic growth and a dovish turn by the European Central Bank. The ECB on Thursday restarted its stimulus program by launching a new round of cheap loans to banks.

The dollar's momentum, though, halted on Friday after a measly 20,000-job increase in domestic payrolls last month, far fewer than 180,000 forecast among analysts polled by Reuters.

That said, the dollar still ended this week on a positive note, rising nearly 0.9 percent despite cratering on Friday after the U.S. jobs report.

RBC Capital Markets remained positive on the U.S. dollar over the next three months.

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"The Fed (Federal Reserve) is on hold, but the U.S. dollar is the highest yielder in G10," said Elsa Lignos, global head of FX strategy at RBC in London. "In an environment where FX volatility is probing the lows, it is hard to ignore the argument of positive carry," she added, referring to the carry trade in which investors sell lower-yielding currencies to buy higher-yielding units.

In the cryptocurrency market, speculators' net short position on bitcoin Cboe futures further increased to 1,438 contracts in the week ended March 5, from 1,280 short contracts the previous week.

Bitcoin has started to creep higher to hit nearly $4,000 on Friday on the Bitstam platform, a two-week high.

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