The prospect of the US Federal Reserve ending its programme of interest rate hikes aimed at tackling inflation, now has a number of hedge fund poised to exit their bullish bets on the dollar, according to a report by Bloomberg.

The prospect of the US Federal Reserve ending its programme of interest rate hikes aimed at tackling inflation, now has a number of hedge fund poised to exit their bullish bets on the dollar, according to a report by Bloomberg.

The report cites data from the Commodity Futures Trading Commission (CFTC) as revealing that long positions held by leveraged funds on the dollar against eight currencies slid by more than 80% as of 27 June from the previous week to 5,196 contracts, the lowest level seen since 7 March.

The greenback has been on a downtrend since peaking in September with the Bloomberg Dollar Spot Index declining in four out of six months so far this year.

While US Fed chair Jerome Powell has indicated that the US may yet need one or two more rate hikes this year, the US seems ahead of some peers including the European Central Bank and the Bank of England in being able to wind down its rate hikes programme, which means the dollar could soon be relatively less attractive than either the euro or sterling.