USD Trimming Continues as Traders Eye Jackson Hole
The latest Commitments of Traders (COT) report shows that traders are trimming their exposure to the US dollar, rebuilding Canadian dollar longs, and cautiously returning to Japanese yen shorts. However, this data predates Wednesday's sharp USD selloff, which means it does not capture the full extent of market sentiment heading into the Jackson Hole meeting.
According to the report, large speculators trimmed their net-long exposure to the US dollar for a third week, but only by $1.2 billion to $34.3 billion. This is despite the US Treasury's buyback plan announcement, which saw the USD index fall 0.8% on Wednesday.
The COT report also shows that asset managers increased net longs in EUR/USD by 12k contracts to a five-week high of 23.7k, while trimming their net shorts in GBP/USD for a third week. In USD/JPY, large speculators increased net shorts to the yen among large speculators by 10.8k contracts.
The Canadian dollar has seen its net-short exposure fall by a combined 30.2k contracts, with gross longs rising 11.4k (36%) among large speculators and 10k (79%) among asset managers.