- Active currency managers on our external manager platform cut back exposures to developed markets currencies last week. Reductions in GBP longs and AUD and CAD shorts were the most prominent, but EUR, SEK and NOK also saw minor cut-backs.
- NZD and JPY were exceptions to the trend. The Positioning Indicator for NZD, the best performing currency vs USD month-to-date, increased to +1.5, the highest in G10. As a result of aggressive selling in the early part of the week JPY saw an increase in short positions, although some of these shorts were cut back after BoJ comments on Thursday.
- The Exposure Indicator remained unchanged, though, as reductions in CLP, HUF, ILS and RON shorts led to an increase in net long exposure to LatAm and CEEMEA FX. Together with NZD buying and reduction in CAD shorts this led to an increase in commodity currency longs to the highest level since 9 January.
(Citibank)
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