Oil prices rebound, and hedge funds' short positions on the New Zealand dollar hit a record high

Odaily News Hedge funds' short positions on the New Zealand dollar have reached a record high, as they believe the recent rebound in global oil prices may exacerbate domestic economic pressures in New Zealand. Data from the Commodity Futures Trading Commission (CFTC) shows that in the week ending July 14, net short positions in the New Zealand dollar held by leveraged funds increased by 1,907 contracts to 29,582 contracts, the highest level since 2006. The bearish stance contrasts with the recent rebound in the New Zealand dollar, which has been mainly driven by hawkish policies from the Reserve Bank of New Zealand.

Additionally, investors' concerns about New Zealand's energy-importing economy are also reflected in the short bets. Escalating tensions between the US and Iran have pushed crude oil prices back above $90 per barrel. The oil price shock may further deteriorate the country's trade balance. Last month, the country barely avoided a trade deficit, while domestic consumer spending declined. (Jin Shi)