Investing.com – Bank of America analysts noted an increase in demand for in a note released on Tuesday, 26, highlighting an increase in purchases by hedge funds and institutional investors.
Hedge funds have shown particularly strong interest in the US currency, with significant purchases in the last week. Bank of America noted that although institutional investors are also purchasing dollars, their positioning remains relatively modest.
“We observed robust demand for the dollar from hedge funds, almost unanimously in the last week,” the bank reported. “Institutional investors followed suit, increasing their purchases in the last two weeks.”
Furthermore, analysts pointed out that hedge funds have resumed selling the , but despite a predominantly bear market against the Japanese currency, the positioning is still not considered excessive.
As for , there appears to be disagreement between hedge funds and institutional investors regarding its future trajectory.
“Institutional investors have been the main drivers of the pound’s appreciation, maintaining a buying trend since last September,” Bank of America added. “On the other hand, hedge funds have adopted a sell stance during the same period. As a result, there has been a shift in positioning, with institutional investors moving from a short to a long position, while hedge funds have moved to a neutral position relative to the previously held short position.”
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