Speculators boost US dollar net longs for 1st time in 5 weeks

New York

SPECULATORS' net long US dollar bets rose for the first time in five weeks, according to calculations by Reuters and US Commodity Futures Trading Commission data which were released on Friday.

The value of the net long dollar position was US$14.24 billion in the week ended Sept 3, compared with US$12.03 billion in the previous week, data showed.

Net long US dollar positions were the smallest in about 14 months in the week ended Aug 27.

In a wider measure of dollar positioning that includes net contracts on the New Zealand dollar, Mexican peso, Brazilian real and Russian rouble, the greenback posted a net long position of US$13.114 in the week ended Sept 3, compared with US$10.558 billion the previous week.

The dollar as a safe haven benefited during the week by escalating trade tensions between the United States and China as both countries slapped tariffs on each other.

But tensions have eased in recent sessions as both China and the United States have scheduled upcoming trade talks, which could diminish some of the bullish positioning on the dollar, some analysts said.

For the month of August, the dollar posted gains of 0.4 per cent against a basket of six major currencies.

The greenback was also boosted by several comments from Federal Reserve officials suggesting a reluctance to cut interest rates at next month's monetary policy meeting, said Kathy Lien, managing director of FX strategy at BK Asset Management in New York.

"All of this makes us increasingly worried that the market is misjudging the degree of Fed dovishness," Ms Lien said.

"A quarter-point cut in September is not a done deal and even if they lower interest rates, the accompanying statement could be less dovish." she added. REUTERS