New York: The US dollar notched its fourth straight year of gains against a basket of major currencies. The dollar index, which measures the greenback against a basket of six major rivals, gained about 3.7 percent for the year.
The dollar index rose about 7.1 percent during the fourth quarter, more than half that gain coming since the November 8
US presidential election on expectations that US President-elect Donald Trump's plan to boost fiscal stimulus would benefit the currency. A faster projected pace of rate hikes from the Federal Reserve next year also contributed.
Several analysts have said that the dollar's uptrend remains intact next year, but noted the risk of dollar weakness given doubts surrounding how much dollar appreciation a Trump White House will tolerate.
"Much depends on how the Trump presidency and the Chinese economy work out," said Marshall Gittler, chief market analyst for retail broker FX Primus. On Friday, the dollar index was last off 0.38 percent at 102.290, down from a 14-year high of 103.65 hit on December 20, and was up 0.18 percent against the yen at 116.74 yen.
The greenback was still set to post its first yearly loss in five against the Japanese currency, of about 2.9 percent. Sterling, which fell roughly 16.2 percent against the dollar to mark its worst year since 2008 on worries over Britain's June 24 "Brexit" vote to leave the European Union, was last up 0.62 percent at $1.2340.
Sterling bore the brunt of concerns this year over Britain's trade policy with Europe which flared up following the Brexit vote, said Jason Leinwand, founder and chief executive of FirstLine FX in Randolph, New Jersey.
The euro was up 0.39 percent against the dollar at $1.0529, but was set to fall 3 percent for the year to notch its third straight yearly loss. The dollar posted sizable gains this year against the Mexican peso and the Chinese yuan of 20.6 percent and 7 percent, respectively.
The peso suffered from Trump's proposals to build a border wall and rewrite trade agreements with Mexico, while the yuan has been pressured by worries about slowing Chinese economic growth.
Gains for the year were led by a more than 16 percent advance against the British pound and more than 7 percent rise versus the Swedish krona.
The dollar dropped about 3 percent against both the Japanese yen and the Canadian dollar while gaining around 3 percent versus the euro, Bloomberg reported. Friday trading was marred by choppy price action and sparse flows and liquidity, leading to some volatile price swings that began in the Asian trading session before subsiding slightly by the time US trading got underway; the dollar was under pressure throughout the day because of month-end portfolio rebalancing and amid an unwind of stale USD longs, traders said
US dollar is lower on the day versus a a majority of its G-10 peers though holds small gains vs JPY; losses are ~0.4 percent as measured by the Bloomberg dollar index after fresh selling made for choppy price action around the 4pm London fixing US dollar was further undercut by a rise in Treasuries that saw the yield on the 10-year note drop for a third session
USD/JPY dropped to near 116.50 amid fixing-timed flows, sparse liquidity and unsubstantial volume, a trader in New York said.
