Hedge funds turned bullish on the yen for the first time since 2021 after sharp swings in foreign exchange markets led to a surge in a popular yen trade.
According to the latest data from the U.S. Commodity Futures Trading Commission (CFTC) for the week ending August 13, leveraged funds held 86 contracts worth about $7 million betting that the yen will appreciate. Speculators overall are positioning for a rise in the yen, marking a sharp turnaround from the extremely negative sentiment that traders saw in early July. A week ago, speculative traders held about 20,000 contracts betting on a weaker yen.
These traders have been reducing their short bets since the beginning of July. Since the beginning of July, the yen has risen about 9% against the dollar, outperforming all other G10 currencies. (Jinshi)