CFTC Positioning Report: The Swiss franc is feeling jittery – Rabobank

Jane Foley, a senior FX strategist at Rabobank, highlights the main points of the CFTC speculators' report for the week ended on May 19th, 2020. 

Key quotes

“USD net longs edged higher for a ninth consecutive week following the mid-March dip. The upward bias is despite the slew of Fed measures aimed at helping USD liquidity.”    

“EUR net longs have dipped lower but remain at relatively elevated levels. The Eurozone’s current account surplus has supported the EUR since the start of the crisis.” 

“Net short GBP positions continued to increase as Brexit fears resume and as criticism grows as to the UK government’s handling of the coronavirus crisis. Comments from BoE Governor Bailey and other MPC members that negative rates have not been ruled out are also GBP negative.” 

“JPY net long positions edged lower but remained mostly consolidative. The safe-haven JPY is likely to be sensitive to any further intensification of tensions between the US and China.”  

“CHF net long positions surged to their highest level since June 2016. The safe-haven CHF is particularly sensitive to political uncertainty within the Eurozone, so the reactions to this week’s European Commission budget could be key.”     

“CAD net short positions continued to grow albeit at a moderate pace. The CAD remains sensitive to the oil prices but USD/CAD trading has been range-bound in the spot market recently.”  

“Net AUD short positions increased again. Concerns about US/China and Australian/China tensions leave the AUD vulnerable given its China trade links.”