FX speculators make yen, euro views crystal clear
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July 1 (Reuters) -The yen looks set for further losses, the euro is vulnerable and the AUD may strengthen if recent ebbs and flows from FX speculators prove prescient.
CFTC data on FX positioning showed the net JPY short rose by nearly a third to a nine-week high of 173,900 contracts in the three weeks ended June 25 - just before USD/JPY vaulted 160, en route to its highest level since 1986.
During the same three-week period, the net EUR position flipped from a long of 67,870 contracts to a short of 8,431 - a shift spurred by the event risk of the French parliamentary election that President Emmanuel Macron unexpectedly called on June 9 (the decisive second round of which is on Sunday July 7).
The net AUD short position, meanwhile, shrank 63% to a three-year low of 23,676 contracts in the fortnight ended June 25 - just before hotter than expected Australian inflation data raised the risk of an August interest rate hike from the Reserve Bank of Australia.
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(Robert Howard is a Reuters market analyst. The views expressed are his own)
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