Svmuu News: A Bank of America survey shows that global portfolio managers’ bearish sentiment toward the yen has risen to its highest level in about four years, as risks surrounding Japan’s fiscal and monetary policy outlook have overshadowed the possibility of government intervention in the foreign exchange market.
In a July 10 report, Bank of America strategists Ralf Preusser, Adarsh Sinha, and others wrote: “Investor bearishness toward the yen has reached its highest level since 2022, driven primarily by monetary and fiscal policy risks.” The Bank of America survey showed that 40% of surveyed traders were bearish on the yen due to risks related to Japan’s fiscal and central bank policies, up from 35% in June. Meanwhile, 10% of respondents were bullish on the yen due to the narrowing U.S.-Japan interest rate spread, down from 12% in June.
Meanwhile, data from the U.S. Commodity Futures Trading Commission (CFTC) shows that as of the end of June, net short positions in the yen held by speculative hedge funds reached their highest level since 2007.