Leveraged Funds Unwind Yen Shorts to 2-Year Low, as of July 7

According to CFTC data as of July 7, leveraged funds' yen net short position fell to -104,231 contracts, the largest reduction in nearly two years. The position decreased by 33,587 contracts from the prior week, signaling a potential weakening of speculative yen shorting bets.

This week brings major U.S. economic data and Federal Reserve communications. The June CPI and PPI will be released on July 14, followed by Fed Chair Kevin Warsh's testimony to Congress on monetary policy. Market consensus expects headline CPI to decline month-over-month due to lower energy prices, with year-over-year inflation easing to 3.8% from May's 4.2%, while core CPI is forecast to hold at 2.9%.