Hedge funds turned bullish on the yen just before dovish comments by Japan’s new prime minister and a robust U.S. jobs report helped spark the worst week for Japan’s currency since late 2009.
Speculative investors flipped to a net long position on the yen for the first time since mid-August, Commodity Futures Trading Commission data for the week to Oct. 1 shows. The buying came right before Prime Minister Shigeru Ishiba said the nation wasn’t ready for further interest rate hikes.
U.S. nonfarm payrolls data that was higher than all estimates further bolstered demand for the greenback, and prompted the markets to price out another big Federal Reserve rate cut next month.
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