Greenback Begins New Year at Lowest Level in Three Months
The U.S. Dollar closed the year sharply lower against a basket of major currencies, plunging to its lowest level in over three months. The annual loss was the largest since 2003. The main catalyst behind the Greenback’s weakness was concern over economic growth in the wake of last week’s biggest tax reform in over three decades.
The Euro closed strong on Friday, finishing at its highest level since September 19. The single-currency has been boosted lately by the weaker U.S. Dollar and increasing bets the European Central Bank might consider raising interest rates by the end of 2018 due to evidence of higher inflation and business activity.
The EUR/USD finished the session at 1.2001, up 0.0059 or +0.49%. It also finished the year with its best performance in 14 years.
Higher commodity prices are also helping to underpin the New Zealand Dollar, however, the currency is also getting a boost from optimism over the new government and the new central bank government. The Kiwi has been supported since NZ Superannuation Fund Chief Adrian Orr was named as next governor of the Reserve Bank. Investors feel that installing a seasoned veteran well known by the business community could fuel economic growth.