Waiting on Japanese Data, the Yen is Up for Now

The yen is the strongest of the major currencies.  It has gained about 0.65% against the dollar.  It has been grinding lower throughout the Asian and European session and has remained in narrow ranges near its highs in the US morning.

Japan still seems isolated in terms of it desire to intervene.  Ahead of the G7 heads of state summit this coming, the risk of intervention remains slight.  Asian and European shares were lower, which favors the yen.  US yields are flat, while the US 10-year premium has narrowed a couple of basis points.

Currency Speculators Jump Ahead of Fed Signals

Speculative positioning in the currency futures began to adjust before the latest signals from the Federal Reserve about the prospects for a summer hike and the widening of interest rate differentials.  In the CFTC reporting week ending May 17, the day before the FOMC minutes were released speculators mostly reduced gross long currency positions and added to gross short positions. 

CFTC: Numerous Large Position Changes Keep Currency Speculators Busy

The US dollar staged an impressive reversal against many of the major foreign currencies on May 3. In the following week, speculators in the currency futures market made significant adjustment in their holdings. We identified a change in the gross position in the currency futures of 10k contracts or more to be significant.

The Dollar Index has been Up for Five Weeks

The US dollar continued the recovery begun May 3 and rose against most of the major currencies over the past week.  A nearly 3.5% rally in oil prices, the fifth weekly gain in the past six weeks (a $9.5 advance over the period), helped the Norwegian krone turn in a steady performance.  The Canadian dollar's 0.2% decline put it in second place. 

Currency Cautiousness Creeping in ahead of Next G7 Meeting

The Japanese yen is recovering from two-day two percent decline.  The yen is the strongest of the majors today, rising about 0.6%.  The greenback initially extended its gains marginally in early Tokyo before the selling pressure emerging.  The price action reinforces the importance of the JPY109.50 resistance area. 

Has the Dollar Entered a New, Bullish Phase?

Sometimes the mountain looks clearer from the plain the summit to paraphrase an American-Lebanese poet.  The dollar appears to have entered a new phase on May 3.  On that day, it reversed higher against the euro, yen, and sterling for lows not seen in a while.   

CFTC: Paring Short Foreign Currency Positions Edition

Speculators in the futures market continued to pare short foreign currency positions but were cautious about expanding long positions in the CFTC reporting week ending May 3.  In fact, two of the three largest adjustments were the cutting of gross long Japanese yen and Australian dollar positions. 

China Writing its Own Merger Story

Alongside China’s booming economy and the country’s appetite for steel, concrete, copper and other construction materials, the last decade has demonstrated that not only can China consume materials, but its corporations are also capable of gobbling up companies around the world.