(Adds details, quote, table) By Gertrude Chavez-Dreyfuss Aug 12 (Reuters) - Speculators reduced favorable bets on the U.S. dollar for a second straight week, as investors remained skeptical about whether the Federal Reserve would raise rates this year despite a strong U.S. non-farm payrolls report last month. The value of the dollar's net long position fell to $11.41 billion in the week ended Aug. 9, from $12.81 billion the previous week, according to Reuters calculations and data from the Commodity Futures Trading Commission released on Friday. "Latest U.S. data released today (weak retail sales, PPI -producer price index) reinforce our belief that the Federal Reserve will find it difficult to eke out more than one rate hike this year, if at all, with a rising probability that the pace of U.S. rate normalization thereafter will remain very gradual," said Samarjit Shankar, global market strategist, at BNY Mellon in Boston. Fed funds futures late Friday saw just a 6 percent chance the Fed would raise rates when it meets next month, down from 18 percent a week ago, according to the CME's FedWatch tool. For the December meeting, the probability of a Fed hike was 43 percent, from about 47 percent last week. Analysts have said the Fed has not raised rates unless market participants have priced in at least a 60 percent chance in the month before it is expected to do so. So far this year, the dollar index has fallen 3 percent, down form 2015's gains of more than 9 percent. Data further showed that sterling net short positions, soared to 90,082 contracts this week, a record high. Speculators have been short sterling since November last year. The pound has been pressured by actions of the Bank of England last week when it cut interest rates and restarted bond purchases in a move to mitigate the impact of Britain's vote to exit the European Union. Analysts see further scope for sterling weakness. Since Britain's vote on June 23, the pound has fallen more than 14 percent. Speculators, meanwhile raised net long positions on the yen to 48,831 contracts, their highest in a month. BNY's Shankar said flows into the safe-haven yen have remained buoyant the past month, having picked up last December during a bout of global de-risking with worries about the slowdown in China. The Reuters calculation for the aggregate U.S. dollar position is derived from net positions of International Monetary Market speculators in the yen, euro, sterling, Swiss franc and Canadian and Australian dollars. Japanese Yen (Contracts of 12,500,000 yen) $-5.991 billion 09 Aug 2016 Prior week week Long 86,719 76,575 Short 37,888 34,875 Net 48,831 41,700 EURO (Contracts of 125,000 euros) $13.674 billion 09 Aug 2016 Prior week week Long 100,442 104,516 Short 198,841 208,619 Net -98,399 -104,103 POUND STERLING (Contracts of 62,500 pounds sterling) $7.319 billion 09 Aug 2016 Prior week week Long 35,523 33,375 Short 125,605 115,890 Net -90,082 -82,515 SWISS FRANC (Contracts of 125,000 Swiss francs) $-0.014 billion 09 Aug 2016 Prior week week Long 20,426 21,216 Short 20,319 22,931 Net 107 -1,715 CANADIAN DOLLAR (Contracts of 100,000 Canadian dollars) $-1.172 billion 09 Aug 2016 Prior week week Long 43,647 41,711 Short 28,281 23,953 Net 15,366 17,758 AUSTRALIAN DOLLAR (Contracts of 100,000 Aussie dollars) $-2.676 billion 09 Aug 2016 Prior week week Long 59,586 58,269 Short 24,702 26,906 Net 34,884 31,363 MEXICAN PESO (Contracts of 500,000 pesos) $1.475 billion 09 Aug 2016 Prior week week Long 19,963 23,915 Short 74,325 76,038 Net -54,362 -52,123 NEW ZEALAND DOLLAR (Contracts of 100,000 New Zealand dollars) $0.044 billion 09 Aug 2016 Prior week week Long 28,314 27,049 Short 28,927 26,832 Net -613 217 (Reporting by Gertrude Chavez-Dreyfuss, editing by G Crosse and Diane Craft)
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