2012.05.25 22:35:08 Speculators Pile Up Largest Net Bets For Dollar, Vs Euro Since 2007

By Chana R. Schoenberger Of DOW JONES NEWSWIRES NEW YORK -(Dow Jones)- Traders on the Chicago Mercantile Exchange bet heavily this week that the dollar will appreciate and the euro will fall, holding a net $31 billion in wagers against the euro and a net $35.3 billion in gambles on the dollar's rise as of Tuesday, government data showed Friday. The bets represented the largest net positions wagering on the euro's fall and the dollar's gain since at least 2007, according to the Commodity Futures Trading Commission's weekly report on the commitments of traders. The Chicago Mercantile Exchange's foreign-exchange traders are seen as representing hedge funds' trades around the world. For the dollar, investors' bets were 25% higher than the previous week. Speculators' net positions against the euro were 12% higher than last week. Traders held a net 195,361 euro contracts as of Tuesday. As currency markets world-wide reacted to the ongoing sovereign-debt crisis in the euro zone, investors also switched their views to pessimistic bets on the Australian and New Zealand dollars. That marks the first time since January 2011 that the CME's traders have bet against the Australian dollar. Speculators now hold net wagers betting that every major currency will fall against the dollar, save the British pound and the Canadian dollar. Investors slashed their net bets against the yen by 47%, to $2.8 billion, or 18,015 contracts. For the Swiss franc, traders continue to hold a net position worth $4.6 billion betting that the currency will depreciate. That position, representing 34,851 contracts, rose 30% this week. The Australian dollar has a net short position of $1.7 billion, with the New Zealand dollar showing a net short position of $114 million. The CFTC's weekly report shows speculative investors' positions in major currencies held against the dollar. It viewed the markets as of Tuesday. -By Chana R. Schoenberger, Dow Jones Newswires; 212-416-4803; chana.schoenberger@dowjones.com; @djfxtrader -Stephen L. Bernard contributed to this article. (END) Dow Jones Newswires May 25, 2012 16:35 ET (20:35 GMT)