The dollar edged up slightly in early Asian trade, while the euro came under pressure as the market braced for further stimulus measures from the European Central Bank this week.
Short-term investors increased short positioning on the euro to 16,633 contracts from 9,220 a week ago, according to data for the week ended May 27 released by the Commodity Futures Trading Commission on Friday. The ECB is preparing a package of policy options for its June 5 meeting that includes cuts in all its interest rates, Reuters reported last month.
“With so much expected from next week’s meeting, focus is shifting to what the Governing Council could do to ‘surprise’ the markets,” such as signalling that more aggressive unconventional quantitative easing measures could be forthcoming, strategists at CitiFX wrote in a note to clients.
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