June 10, 2016 / 9:15 PM / 3 years ago

UPDATE 1 -Sterling net shorts post largest increase in 5 years -CFTC, Reuters

(New throughout, adds sterling contracts, table, details on
dollar and sterling)
    By Gertrude Chavez-Dreyfuss
    NEW YORK, June 10 (Reuters) - Speculators ramped up their
bets against sterling in the latest week by the most in nearly
five years, as hedge funds and other asset managers struck a
decidedly defensive stance in the British currency two weeks
ahead of a crucial referendum over whether the country should
remain in the European Union.
    Sterling net short positions more than doubled to 66,299
contracts, valued at nearly $6 billion, in the week ended June 7
from 32,851 the previous week, according to data from the
Commodity Futures Trading Commission released on Friday. It was
the largest net short position in sterling in three years, and
the weekly increase was the largest since September 2011.  
    Speculators have been persistently net short sterling for
about six months. Until the latest reading, however, net short
positioning had fallen substantially from the previous
three-year high hit back in April.
    With market participants growing increasingly focused on
what is seen as a toss-up result, open interest in CME sterling
futures has been building. In the latest week, it rose by more
than 15,000 contracts to a three-month high of 259,238 valued at
more than $23 billion.
    Sterling on Friday fell to a two-month low in the wake of
the latest poll on the EU referendum, and so far this year, the
British pound was down 3.2 percent. 
    Britons will vote on June 23 on whether to leave the EU, a
decision with far-reaching implications for politics, the
economy and trade in Europe. 
    According to a poll by ORB for The Independent newspaper
published on Friday, the "Leave" camp was 10 points ahead of
"Remain". It was the biggest lead enjoyed by those wanting
Britain to quit the 28-member bloc since the poll series started
a year ago, The Independent said. 
    Net long dollar positioning, meanwhile rose for a third
straight week, with net longs rising to their highest in four
months despite last week's U.S. non-farm payrolls report for May
that came way below market expectations. 
    The value of the dollar's net long position rose to $11.30
billion in the week ended June 7, from $4.86 billion the
previous week.
    Position changes were most significant among the reserve
currencies, with notable deteriorations in already bearish
sentiment toward the euro and the British pound. 
    Swiss franc net positioning has turned bearish from neutral.
    The yen, meanwhile, is the largest held net long while the
euro and sterling were the largest held net shorts.
    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) 
         07 Jun 2016            Prior week
         week             
 Long             68,237            46,964
 Short            25,384            32,127
 Net              42,853            14,837
 
EURO (Contracts of 125,000 euros)
         07 Jun 2016            Prior week
         week             
 Long             93,492            98,218
 Short           160,604           135,872
 Net             -67,112           -37,654
 
POUND STERLING (Contracts of 62,500 pounds sterling)
         07 Jun 2016           Prior week
         week             
 Long             36,337           36,546
 Short           102,636           69,397
 Net             -66,299          -32,851
 
SWISS FRANC (Contracts of 125,000 Swiss francs)
         07 Jun 2016           Prior week
         week             
 Long             21,644           24,291
 Short            31,289           24,162
 Net              -9,645              129
 
CANADIAN DOLLAR (Contracts of 100,000 Canadian dollars)
         07 Jun 2016           Prior week
         week             
 Long             37,421           38,753
 Short            15,884           12,494
 Net              21,537           26,259
 
AUSTRALIAN DOLLAR (Contracts of 100,000 Aussie dollars)
         07 Jun 2016           Prior week
         week             
 Long             35,406           44,560
 Short            51,214           49,318
 Net             -15,808           -4,758
 
MEXICAN PESO (Contracts of 500,000 pesos)
 $1.615 billion
         07 Jun 2016           Prior week
         week             
 Long             22,389           20,193
 Short            81,698           75,808
 Net             -59,309          -55,615
 
NEW ZEALAND DOLLAR (Contracts of 100,000 New Zealand dollars)
         07 Jun 2016           Prior week
         week             
 Long             38,562           31,919
 Short            30,026           26,415
 Net               8,536            5,504
 
 (Reporting by Gertrude Chavez-Dreyfuss; Editing by Diane Craft
and David Gregorio)
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