Dollar Poised to Snap Three-Month Rally as Gradual Fed Pace Seen
- Greenback drops against most of its 16 major counterparts
- Traders exiting bullish dollar positions before year-end
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The dollar is headed for its biggest monthly decline since April, snapping a three-month rally, as investors anticipate a measured pace of interest-rate increases by the Federal Reserve.
The U.S. currency has dropped about 2 percent in December, falling from a 12-year high and paring its advance since mid-2014 to 23 percent. Traders see a 54 percent chance the central bank will tighten policy by April, according to data compiled by Bloomberg based on futures. After lifting rates from near zero this month, Fed Chair Janet Yellen signaled a gradual approach to additional increases.