Hedge funds dramatically cut their bets on the yen after Japanese authorities allegedly carried out a dual market intervention to strengthen the currency.
Data from the Commodity Futures Trading Commission (CFTC) showed that leveraged funds reduced net short positions on the yen by 38,025 contracts in the week to July 16, the most since March 2011.
While still bearish at a net 76,588 contracts, the shift coincides with improving sentiment for the yen, which last week recovered to its highest level against the dollar since early June. Hedge funds retreated during what was a turbulent week of trading, with Japan spending an estimated ¥5.64 trillion ($35.8 billion) in two sessions to lift the yen from near its weakest levels since the 1980s.
