Speculators turned negative on the U.S. dollar this week, with more investors in the global currency market taking short positions against the dollar than long positions, for the first time in nearly a year.
The value of the dollar’s position fell to -$1.85 billion in the week ended April 19, from $0.4 billion the previous week, according to Reuters calculations and data from the Commodity Futures Trading Commission released on Friday.
It was the first time since May 6 that investors have been short the dollar on a net basis.
Net long yen contracts rose to 71,870, the highest since Reuters records began in March 1995, surpassing the previous high touched last week when yen contracts rose to 66,190.
The dollar rose 2 percent against the yen on Friday, hitting a three-week high against the Japanese currency, after a report the Bank of Japan was considering expanding its negative rate policy to bank loans and could cut rates further.
For the week, the dollar was set to rise 2.6 percent against the yen, which would mark its strongest weekly gain against the Japanese currency since late October 2014.
The dollar hit a 17-month low against the yen of 107.61 yen on April 11. Analysts partly attributed the yen’s rise to bets that the Bank of Japan would not intervene to stop the yen’s recent rally.
A weaker currency is desireable because Japan’s economy relies heavily on exports and a weaker currency makes Japanese products less expensive to foreign buyers.
Euro net short contracts fell to 46,917, their lowest in eight weeks.
The dollar rose this week against a basket of six major world currencies, its second weekly gain in a row after falling five of the past six weeks.
The Reuters calculation for the aggregate U.S. dollar position is derived from net positions of International Monetary speculators in the yen, euro, British pound, Swiss franc and Canadian and Australian dollars.