NEW YORK: Speculators’ net long positioning on the US dollar rose in the latest week to its highest since early August, according to calculations by Reuters and US Commodity Futures Trading Commission data released on Friday.
The value of the net long dollar position climbed to $16.18 billion in the week ended Sept. 6, from $14.21 billion the previous week, CFTC data showed. US dollar net longs have increased for four straight weeks.
A hawkish Federal Reserve that is poised to raise interest rates by another 75 basis points at this month’s policy meeting to stamp out inflation has boosted the greenback, propelling it to historic highs against major currencies.
The dollar this week soared to a 24-year high against the yen and a 37-year peak versus sterling, with the dollar index surging to a more than 20-year high.
So far this year, the dollar index has gained nearly 14% against a basket of six major currencies.
CFTC data also showed that Japanese yen net shorts increased in the latest week to 58,189 contracts, the largest since late July. Among the major currencies, the yen has struggled the most against the dollar as the Bank of Japan remains the only central bank that is not in a tightening mode. Since the beginning of the year, the yen has plummeted by nearly 20% against the dollar.
The yen hit a 24-year low this week against the greenback of just under 145 yen.
“Dollar/yen rates reversed ahead of the 1998 highs in the 146-147 area this week, and between the nearly fully discounted 75-bps (basis points) rate hike from the Federal Reserve and the most intense jawboning from the BOJ (Bank of Japan) in years, (exchange) rates could fall further through the middle of the month,” wrote Matt Weller, global head of research at Forex.com and City Index.
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