Sterling Futures Net Short Jumps 41 Percent in a Week Ahead of the 28 October UK Budget
Speculative traders raised their net short position in sterling futures by 23,853 contracts to 82,568 contracts in the week to 22 September, according to Commodity Futures Trading Commission data released on 25 September, a rise of 40.6 percent on our calculation. That is the largest net short since 7 July, with a notional value of about 5.16 billion pounds at the Chicago Mercantile Exchange contract size of 62,500 pounds, also on our calculation. The Budget, 31 days away on 28 October, will be accompanied by a new forecast from the Office for Budget Responsibility.
Who is short
The CFTC’s breakdown by trader type shows the bet sits with asset managers, whose net short rose to 115,805 contracts, an increase of 26,594 on our calculation. Leveraged funds remained net long, although their position fell to 13,239 contracts from 18,878. The move also came as open interest fell 22.1 percent to 244,925 contracts after the September contract rolled off, so the net short now equals 33.7 percent of open interest, against 18.7 percent a week earlier, on our calculation.
| Measure | 22 Sep 2026 | 15 Sep 2026 | 2026 extreme |
|---|---|---|---|
| Non-commercial net position | -82,568 | -58,715 | -105,719 (23 Jun) |
| Asset managers, net | -115,805 | -89,211 | -156,307 (30 Jun) |
| Leveraged funds, net | +13,239 | +18,878 | |
| Open interest | 244,925 | 314,293 |
Commitments of Traders, British pound futures on the Chicago Mercantile Exchange, futures only, contracts. Non-commercial from the legacy report; asset managers and leveraged funds from the Traders in Financial Futures report.
On our calculation, the current position is 78.1 percent of the 23 June peak, which was the largest non-commercial net short since April 2017, and the asset manager short of 30 June was the largest in the series since it began in 2006. On our count, non-commercial traders have now been net short sterling for 61 consecutive weeks.
Sterling and gilts
The pound fell to 1.32 dollars on 24 September, its lowest since 29 June, and was on track for a weekly fall of 1.2 percent, Reuters reported on 25 September. On Bank of England data, sterling stood at 1.3220 dollars on 24 September, 1.1 percent lower than on 18 September and 1.7 percent below the end of 2025, but 1.5 percent higher against the euro over the year to date, on our calculation. The Bank held Bank Rate at 3.75 percent on 17 September by a 6 to 3 vote, with 3 members voting for a rise to 4 percent. The 10 year nominal par gilt yield stood at 5.29 percent on 23 September, 82 basis points above the end of 2025 on our calculation.
The fiscal backdrop
Public sector borrowing reached 18.3 billion pounds in August, 3.5 billion pounds above the budget watchdog’s forecast, and 77.3 billion pounds in the financial year to August, 8.1 billion pounds above it, the Office for National Statistics said on 22 September. Net debt stood at 93.8 percent of GDP. The OBR’s March forecast has taxes rising from 36.3 percent of GDP in 2025-26 to 38.5 percent in 2030-31, which it described as a historic high and which is 5.6 percentage points above the 32.9 percent of 2019-20, on our calculation.
Why it matters: Sterling enters the run-up to the Budget with borrowing above the March forecast and gilt yields well above their end-2025 level, while the positioning data show the bearish bets concentrated among asset managers, with leveraged funds still net long.
Outlook: The Budget and the budget watchdog’s updated forecast on 28 October, and the next Bank Rate decision on 5 November, are the main events for sterling.
Sources: Commodity Futures Trading Commission, CME Group, Bank of England, Reuters, Office for National Statistics, Office for Budget Responsibility, HM Treasury.
