Source: Bloomberg
Author: Naomi Tajitsu
Article: Original article
Date of publication: Thursday, Dec. 1, 2022
The dollar has continued to decline following its largest one-month drop since 2009. In fact, investment managers are placing bets that the currency’s fall will extend further.
Over the last month, pension funds, insurance firms and other institutional investors have accumulated their biggest dollar short position in a year and a half. This is reported by the U.S. Commodity Futures Trading Commission (CFTC).
Net dollar positions
As institutional investors and leveraged funds turn into net sellers, the market may see it as a sign that the dollar is falling. This is what happened in two previous cycles of currency weakness in 2017 and 2020.
Forecast:
Euro is likely to rise against the dollar.
This content is for informational purposes only and is not intended to be investing advice.
