(Bloomberg) -- Hedge funds held a large bet against the yen in the days before comments from Bank of Japan Governor Kazuo Ueda triggered the biggest jump in the Japanese currency in almost a year on speculation of a near-term shift in monetary policy.

Speculators remained near the most bearish on the yen since April 2022 in the week ending Dec. 5, according to data from the Commodity Futures Trading Commission released on Friday. Leveraged funds trimmed their net-short position to 64,841 contracts, down slightly from the previous week’s report of 65,611 contracts.

The yen jumped almost 4% on Thursday after comments by Ueda and one of his deputies were interpreted as pointing toward the end of the bank’s negative-rates regime. Trading in the currency soared, with the CME Group Inc. reporting $74.8 billion of activity in the yen, the most this year. 

Even after this week’s jump, the yen is still down about 9.5% against the US dollar for the year, making it the second-worst performing currency among its peers in the Group-of-10 nations. The BOJ will meet next on Dec. 19.

Two-week dollar-yen risk reversals, which span the upcoming BOJ rate decision, indicate the market is anticipating a decent amount of further yen gains in the near-term. 

The CFTC report also showed leveraged funds increased their net-short position on the euro, while boosting their bullish view on the pound. 

  • Leveraged funds adjusted net positions as follows:
    • Reduced net JPY short by 770 contracts to 64,841
    • Increased net EUR short by 8,911 contracts to 10,405
    • Raised net GBP long by 8,791 contracts to 12,725
    • Decreased net AUD short by 523 contracts to 8,582
    • Boosted net NZD short by 3,942 contracts to 8,503
    • Raised net CAD short by 1,680 contracts to 35,853
    • Reduced net CHF short by 1,289 contracts to 2,675
    • Raised net MXN long by 6,715 contracts to 24,918
  • Asset managers changed net positions as follows:
    • Reduced net JPY short by 4,419 contracts to 18,078
    • Increased net EUR long by 15,910 contracts to 402,608
    • Reduced net GBP short by 2,525 contracts to 26,971
    • Cut net AUD short by 10,008 contracts to 71,505
    • Trimmed net NZD short by 6,810 contracts to 17,068
    • Lowered net CAD short by 3,855 contracts to 49,148
    • Added net CHF short by 791 contracts to 11,058
    • Increased net MXN long by 2,652 contracts to 130,617

--With assistance from George Lei.

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