CFTC FX positioning data as of 2 June still failed to realign with the recent dynamics in the spot and futures markets. Despite some signs of a short squeeze in the New Zealand dollar, the unchanged and deeply short positioning in the Australian and Canadian dollars - along with net longs in defensive Japanese yen and Swiss franc – still reflects a risk-off environment (figure below). {image} NZD had long been the most oversold currency in the G10 when global risks took centre stage. The currency sold off at the peak of the US-China trade war last year and during the pandemic-induced market shock this year. Last ... (full story)