Speculators' net long bets on US dollar at an 11-week high

New York

SPECULATORS' net long bets on the US dollar rose to an 11-week high in the latest week, according to calculations by Reuters and US Commodity Futures Trading Commission data on Friday (Apr 1).

The value of the net long dollar position was US$16.11 billion for the week ended Mar 29, the highest since the week ending Jan 11. The previous week, speculators' net long position stood at US$13.27 billion. US dollar positioning was derived from net contracts of International Monetary Market speculators in the Japanese yen, euro, British pound, Swiss franc, and Canadian and Australian dollars.

The US dollar has strengthened this year as geopolitical tensions have mounted and as the US Federal Reserve has moved to raise interest rates in a bid to curb surging inflation.

The dollar, which rose 6.3 per cent against a basket of currencies in 2021, climbed another 2.7 per cent in the first quarter.

On Friday, the greenback edged higher, helped by robust US job growth numbers for March that firmed market expectations that the Federal Reserve will remain on track to increase the pace of interest rate hikes.

Meanwhile, the Canadian dollar edged lower against its US counterpart on Friday, extending a modest weekly decline, as oil prices fell and the gap between US and Canadian bond yields moved in favour of the US bonds.

The loonie was down 0.1 per cent at 1.2515 to the greenback, or 79.90 US cents, after trading in a range of 1.2481 to 1.2539. For the week, the currency weakened 0.3 per cent, after touching on Wednesday its strongest intraday level in nearly 5 months at 1.2427.

The Canadian dollar "looks to be consolidating around 1.2500", said Eric Theoret, global macro strategist at Manulife Investment Management. "Interest rate differentials have been moving in favour of the US dollar and may act as a near term headwind." REUTERS