CFTC: JPY turns net long for the first time in five weeks – Rabobank

US Dollar (USD) net short positions have increased for the third consecutive week. Euro (EUR) net short positions have increased for the third consecutive week. The Pound Sterling (GBP) net long positions have decreased for the third consecutive week, and Japanese Yen (JPY) positions have turned net long for the first time in five weeks, Rabobank’s FX analysts Jane Foley and Molly Schwartz note.

JPY is the best-performing G10 currency in November

“USD net short positions have increased for the third consecutive week, driven by a decrease in long positions. USD was the second-best performing G10 currency y-t-d as of December 3rd, but investor confidence of a 25bp cut come the December 18th meeting has been rising, with 71% of a 25bp cut priced in as of December 3rd (and 85% priced in at the time of writing).”

“EUR net short positions have increased for the third consecutive week, driven by an increase in short positions. EUR was the worst performing G10 currency in the month of November, depreciating 2.37% against USD. EUR has suffered from deteriorating economic fundamentals and impending cuts from the ECB. We expect the ECB to cut the policy rate 25bp at the December 12th.”

“GBP net long positions have decreased for the third consecutive week, driven by an increase in short positions. GBP/USD is trading at 1.2737 as of December 6th, having run into resistance at the 200D SMA (1.2822). JPY positions have turned net long for the first time in five weeks, driven by a decrease of around 20,000 short positions. JPY was the best-performing G10 currency in November, returning 2.16% against USD.