Speculators stepped up their bearish stance on the yen to its highest level in almost a year as the yen weakened further against the dollar as the market strengthened expectations of a rate hike by the US Federal Reserve.
Leveraged funds increased their net short positions in the yen by 10,986 contracts to 53,706 contracts, the highest since June last year, according to Commodity Futures Trading Commission data for the week ending May 23. The yen has fallen more than 3% this year. May was the third-worst performance among G10 countries after the dollar strengthened significantly.
While major central banks have raised interest rates to keep inflation under control, the Bank of Japan has maintained an ultra-loose policy and Governor Kazuo Ueda has repeatedly said it will remain patient with monetary easing.
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