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Short spec positioning in EUR irrelevant - SocGen

FXStreet (Bali) - Sebastien Galy, Strategist at Societe Generale, notes that short spec positioning in EUR are not that relevant at this point.

Key Quotes

"Speculative positioning is a drop in the water when compared to current foreign portfolio investment in the eurozone. Foreign reserves have USD2.9trn in EUR reserves according to our estimates, yielding close to zero. As much of this is held by reserves that need to pay their liabilities from pensions to expensive domestic yields, the incentive is very strong to reduce their EUR or, for that matter, JPY positions. They have far better prospects in USD. There are persistent indications of a steady concentration of portfolios in USD with secondary reserves gaining (e.g. CNY...)."

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