* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E
(Adds context, yearly performance for currency pairs, updates
prices)
By Karen Brettell
NEW YORK, Dec 31 (Reuters) - The dollar posted its biggest
yearly loss since 2017 on Thursday, capping off a manic year
that saw the currency serve as a safe haven in March when panic
over the spread of COVID-19 in the United States peaked, before
dropping on unprecedented Federal Reserve stimulus.
The greenback soared to a three-year high of 102.99 against
a basket of currencies =USD in March, before ending the year
at 89.96, down 6.77% on the year and 12.65% from its March high.
An improving global economic outlook as COVID-19 vaccines
are rolled out, rock-bottom U.S. interest rates and ongoing Fed
bond purchases have dented the dollar's appeal.
Expectations of additional fiscal stimulus and rising fiscal
and current account deficits are additional headwinds that are
likely to hurt the U.S. currency over the coming year.
"I expect the dollar to depreciate further over the next few
years as the Fed keeps rates at zero whilst maintaining its
bloated balance sheet," Kevin Boscher, chief investment officer
at asset manager Ravenscroft, told clients.
"The magnitude of the twin deficits dwarfs any other major
economy," he said.
The euro EUR=EBS ended at $1.2215, up 8.97% on the year.
It reached $1.2310 on Wednesday, the highest since April 2018,
but pared gains as investors squared positions for the year.
The Aussie and kiwi both hit their highest levels since
April 2018 on Thursday with the Aussie AUD= surging as high as
$0.7743 and the New Zealand dollar NZD= reaching $0.7241. They
pared gains but ended up 9.76% and 6.82% this year,
respectively.
The dollar slipped 4.90% this year against the Japanese
currency to 103.25 yen. It is holding just above a nine-month
low of 102.86 yen reached on Dec. 17.
The greenback also lost 12.09% to the Swedish crown SEK= ,
ending at 8.2176.
Bitcoin blasted to a record high of $29,300 on Thursday,
taking the yearly gain for the world's most popular
cryptocurrency past 300% BTC=BTSP . U.S. Senate leader Mitch McConnell dealt a likely death blow
on Wednesday to Republican President Donald Trump's bid to boost
coronavirus aid to Americans, declining to schedule a swift
Senate vote on a bill to raise relief checks to $2,000 from
$600. However, Democratic President-elect Joe Biden, who takes
office next month, is expected to push for more measures to
support the U.S. economy.
Data on Thursday showed that the number of Americans filing
first-time claims for unemployment benefits unexpectedly fell
last week but remain elevated more than nine months.
Investors are also watching runoff elections in Georgia for
two Senate seats next Tuesday that will determine which party
controls the Senate. If the Republicans win one or both of the
Georgia seats, they will retain a slim majority in the chamber
and can block Biden's legislative goals and judicial nominees.
Sterling got a boost after Britain's markets watchdog
intervened hours before the country leaves the European Union's
single market on Thursday with a partial climbdown on curbs that
risked disrupting swaps trades worth billions of euros.
The pound GBP=D3 ended up 2.98% at $1.3656 after a year
full of Brexit drama. It reached $1.3686 earlier on Thursday,
the highest since May 2018.
The greenback fell 1.79% this year against the Canadian
dollar, ending at 1.2755 Canadian dollars. The loonie's recent
rise has lagged other currencies as oil prices waver.
"The lack of direction in oil prices over that last 10 days
or so has rendered the Canadian dollar the underperformer of the
dollar bloc pack," analysts at Action Economics said in a report
on Thursday. Oil is a major Canadian export.
========================================================
Currency bid prices at 2:01PM (1901 GMT)
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Dollar index =USD 89.9610 89.5950 +0.42% +0.00% +89.9800 +89.5150
Euro/Dollar EUR=EBS $1.2215 $1.2300 -0.68% +8.97% +$1.2310 +$1.2215
Dollar/Yen JPY=D3 103.2450 103.2600 +0.03% -4.90% +103.3050 +103.0050
Euro/Yen EURJPY= 126.11 126.92 -0.64% +3.41% +126.9800 +126.1300
Dollar/Swiss CHF=EBS 0.8856 0.8814 +0.47% -8.48% +0.8856 +0.8794
Sterling/Dollar GBP=D3 $1.3656 $1.3626 +0.23% +2.98% +$1.3685 +$1.3600
Dollar/Canadian CAD=D3 1.2755 1.2751 +0.06% -1.79% +1.2769 +1.2714
Aussie/Dollar AUD=D3 $0.7700 $0.7686 +0.20% +9.76% +$0.7742 +$0.7682
Euro/Swiss EURCHF= 1.0817 1.0841 -0.22% -0.32% +1.0846 +1.0799
Euro/Sterling EURGBP= 0.8943 0.9025 -0.91% +5.78% +0.9035 +0.8944
NZ NZD=D3 $0.7187 $0.7205 -0.24% +6.82% +$0.7240 +$0.7183
Dollar/Dollar
Dollar/Norway NOK=D3 8.5845 8.5400 +0.59% -2.07% +8.5900 +8.5015
Euro/Norway EURNOK= 10.4902 10.4915 -0.01% +6.63% +10.5230 +10.4480
Dollar/Sweden SEK= 8.2176 8.1964 -0.38% -12.09% +8.2249 +8.1504
Euro/Sweden EURSEK= 10.0382 10.0764 -0.38% -4.12% +10.0949 +10.0100