Dollar Ends Best Year in More Than a Decade - Wall Street Journal

The dollar is on track to close 2014 with its strongest year against rival currencies in more than a decade after investors piled into U.S. assets in anticipation of higher interest rates.

The WSJ Dollar index, which compares the greenback against a basket of widely traded currencies, rose more than 12% in 2014, reaching 83.04 Wednesday, the highest since September 2003.

The dollar rose 0.3% versus the Japanese currency in late-afternoon trade, to 119.79 yen, and gained almost 14% in 2014. The euro fell 0.5% to $1.2099, falling below $1.21 for the first time since July 25, 2012. For the year, the euro lost almost 12% versus the greenback.

Investors rushed into the dollar in the second half of 2014, confident that stronger U.S. economic data would persuade the Federal Reserve to raise interest rates from near zero for the first time since before the financial crisis. At the same time, anemic growth and inflation in the eurozone and Japan forced their respective central banks to ease monetary policy, taking measures that ultimately weakened their currencies.

“We’re closing on a really strong year for the dollar,” said Martin Schwerdtfeger, currencies strategist at TD Securities. “And there are expectations for the dollar to continue to strengthen into the new year.”  Read More at WSJ

U.S. Government Bonds Strengthen to Close Big Year

Jobless Claims Rise, Remain Near Postrecession Lows