Citibank Closes All Long Dollar Positions As Unit Plunges
11/18/2003
Dow Jones News Services
(Copyright © 2003 Dow Jones & Company, Inc.)
NEW YORK (Dow Jones)--Citibank, one of the largest traders in global foreign exchange markets and biggest dollar bulls, closed all its existing long dollar positions Tuesday.
The move, on the day the dollar plunged to record lows against the euro, is significant in that the dollar's slide has forced one of the most aggressive dollar bulls in the market to temper its optimism toward the currency.
In a research note, Citibank currency analysts cite three specific reasons: the U.S. decision Tuesday to impose temporary quotas on certain textile imports from China, the dollar's failure to respond to positive U.S. economic data and the breakdown of key technical levels such as dollar index support at 90.56.
Citibank, a unit of Citigroup Inc. (C), retains a bullish outlook for the dollar in the medium term, and will look "for more advantageous entry levels over coming weeks."
But the bank posted 1.5% losses in closing out its long dollar/Swiss position at CHF1.2945, losses of 2% in closing its short euro/dollar position at $1.1940, and losses of 0.7% in closing its long dollar/yen position at Y108.04.
Tuesday, the euro surged to a record high of $1.1960, the dollar fell to a five-month low of CHF1.2931 and dipped below Y108.00, within a whisker of new three-year lows. |
