For The First Time Corporations Are Selling Dollar

Hedge funds and other large speculators are betting on a weak dollar for the first time in almost two years.

Positions that will benefit from the depreciation of the US currency exceed those interested in the rise of 21.567 orders for the week ended on April 19, according to the Friday's report from the Commodity Futures Trading Commission. This is the first time since July 2014, when data showed no net long positions in dollar against eight other major currencies.

Buying dollar was a winning trade for the past two years. Now, the Fed is towards higher interest rates and there was an aggressive quantitative reassurance in Europe and. Dollar rose by more than 20% since mid-2014. Appreciation stopped after a slowdown in the economy, prompted the US central bank to cut forecasts for growth and inflation at the meeting last month.

"The meeting in March implied a message, that there is no hurry to increase the interest rates" - said Mazen Isa, Senior Currency Strategist at Toronto-Dominion Bank in New York. "It is indicative that the ambiguity of 2015 has increased in 2016."

Bloomberg Dollar Spot Index, which tracks the US currency against 10 major currencies, rose by 0.4 percent this week, compared to 4% decline this year.

Futures traders are betting, there is no chance that Federal Reserve Chairman Janet Yellen and monetary policy committee will raise rates at their meeting next week. According to them, there is 63% likelihood that the central bank will not increase the rates until December, compared with 50 percent chance given a week ago. The calculation assumes an effective interest rate of 0.625% on average, after the next increase by the central bank.

"Remember, that Janet Yellen is now firmly holds the position that dollar will rise only if inflation goes up" - said Axel Merk, president of Merk Investments LLC to Bloomberg Television. "Dollar is exhausted, so the rise is".