The dollar edged lower amid a sell-off in hedge funds by Investing.com

Investing.com – The US dollar has sold off across the board, analysts at Bank of America say, and further losses remain a possibility.

“Our property flows show that dollars have been sold across the board so far in August, particularly from hedge funds and corporates,” Bank of America analysts said in an Aug. 19 note.

“The EUR, JPY and GBP have benefited the most, but more recently also the high-beta G10 currencies and EM FX. The hedge fund’s long USD position remains vulnerable.”

Despite the pound being the weakest G10 currency so far in August, our investors’ own flows remain positive, with hedge funds in particular providing strong support.

“The GBP position is long but not stretched, with hedge funds having more space,” Bank of America added.

Last week was the first in which the bank’s own EM FX turned positive since the recent market turmoil.

“Hedge funds bought INR, KRW and ZAR – sold HUF. Real money bought BRL, IDR, SGD, PLN and CZK – sold CNH and ILS,” the bank said.

“Global EM FX positioning is slightly short, except in Asia where it is clearly short after the recent market sell-off. EM FX hedge fund short position also looks stretched,” BoA added.