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    UK’s net position for GBP NC dropped to £-755K from £-93.2K

    by VT Markets
    /
    Dec 20, 2025
    The United Kingdom’s CFTC GBP NC net positions have dropped to £-755,000, down from £-93,200.

    Market Positioning Indicators

    Data shows changes in how non-commercial traders view the British pound. This drop might indicate changing market attitudes or adjustments in currency hedges. The Commodity Futures Trading Commission released these figures, which help us understand market positioning in foreign exchange. This week, we saw a large increase in bets against the British Pound. The net short position held by speculators surged from -£93.2K to -£755K. This reflects a strong belief among traders that the pound will likely weaken further soon. Such negative sentiment matches recent weak economic news. The UK’s Q3 2025 GDP growth was revised down to just 0.1%. Also, comments from the Bank of England suggest a shift towards a more supportive policy by early 2026. This stance contrasts sharply with the US Federal Reserve, which continues its hawkish approach.

    Derivative Market Implications

    For derivative traders, this trend means the cost to protect against a falling pound is likely rising. We can expect higher implied volatility in GBP options, especially for puts on pairs like GBP/USD. This suggests a greater chance of further declines as we head into the new year. While it might seem wise to follow the trend in GBP futures by holding short positions, we must be careful. The trade is becoming crowded, making the pound at risk for a sudden rally, or “short squeeze,” if any good news comes out. The memory of the Gilt market’s sharp turnaround in late 2022 serves as a cautionary tale. In the coming weeks leading into 2026, we should pay close attention to upcoming inflation figures and retail sales data for December. Any surprises could lead to significant market movements. The market will also be alert to any comments from government officials, particularly after the close election results last month. Create your live VT Markets account and start trading now.

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