Speculators trim bets against U.S. dollar - CFTC

NEW YORK, Sept 3 (Reuters) - Currency speculators trimmed
bets against the U.S. dollar in the latest week, data from the
Commodity Futures Trading Commission showed on Friday.

The value of the dollar's net short position shrank to
$7.1 billion in the week ended Aug. 31, down from a net short
position of $11.12 billion in the previous week, according to
CFTC and Reuters data.

Speculators had been long the dollar for most of the first
half of 2010 but began betting against it regularly in July as
U.S. economic data suggested economic recovery was slowing.

Speculators cut their long positions on the Japanese yen
but increased them on the Swiss franc in the latest week.

The Swiss franc CHF= is viewed as a safe haven amid fears
the global economy is slowing.

While the yen JPY= is also viewed as a safe haven, the
currency's rapid advance in recent weeks prompted Japanese
authorities to announce easing measures on Monday. A strong yen
makes Japan's exports more expensive and reduces their
competitiveness.

That made some speculators more cautious on the yen though
traders and analysts alike said that, short of direct
intervention in the foreign exchange markets, the yen is bound
to test its all-time high against the dollar of 79.75 yen set
in April 1995. On Friday the dollar traded at 84.45 yen.

This week's CFTC data showed net long yen positions fell to
49,904 from 51,069 contracts last week and total long yen
positions fell slightly to 61,219 contracts from 63,086
contracts, in the prior week.

Scotia Capital says record net yen long positions posted at
65,920 contracts on March 25, 2008, with record yen longs at
94,654 on March 4, 2008.

The larger the number of long yen contracts, the more
speculators will have to scramble to reverse positions to
prevent losses in the event of a decline in yen and a rally in
the dollar.

A long position is a bet that a currency will rise in
value, while investors who go short expect it to fall.

The Reuters calculation for the aggregate U.S. dollar
position is derived from the net positions of International
Monetary Market speculators in the yen, euro, British pound,
Swiss franc, Canadian and Australian dollars.

JAPANESE YEN (Contracts of 12,500,000 yen)

8/31/10 week 8/24/10 week

Long 61,219 63,086

Short 11,315 12,017

Net 49,904 51,069

EURO (Contracts of 125,000 euros)

8/31/10 week 8/24/10 week

Long 51,099 54,591

Short 76,668 76,194

Net -25,569 -21,603

POUND STERLING (Contracts of 62,500 pounds sterling)

8/31/10 week 8/24/10 week

Long 23,052 28,511

Short 38,318 32,876

Net -15,266 -4,365

SWISS FRANC (Contracts of 125,000 Swiss francs)

8/31/10 week 8/24/10 week

Long 21,185 20,735

Short 6,904 6,867

Net 14,281 13,868

CANADIAN DOLLAR (Contracts of 100,000 Canadian dollars)

8/31/10 week 8/24/10 week

Long 26,957 24,889

Short 31,721 8,742

Net -4,764 16,147

AUSTRALIAN DOLLAR (Contracts of 100,000 Aussie dollars)

8/31/10 week 8/24/10 week

Long 54,261 58,462

Short 10,453 11,445

Net 43,808 47,017

MEXICAN PESO (Contracts of 500,000 pesos)

8/31/10 week 8/24/10 week

Long 38,731 68,371

Short 17,727 9,001

Net 21,004 59,370

NEW ZEALAND DOLLAR(Contracts of 100,000 New Zealand
dollars) 8/31/10 week 8/24/10 week

Long 12,193 14,931

Short 5,236 4,248

Net 6,957 10,683
(Reporting by Nick Olivari; Editing by James Dalgleish)