2014 dollar domination in numbers

With 2015 arriving in some parts of the world and assuming we will not get extreme last minute movements, here are some numbers for 2014.

The dollar certainly comes on top, but there is quite a big variety between the various currencies, which lost between just under 5% to more than 13%:

The main driver for the dollar strength is the Fed not only ending QE but also moving towards a rate hike in 2015, and there are good reasons.

• EUR/USD closed 2013 at 1.3758 and now trades at 1.2153: down 11.66%. A historic negative deposit rate and serious QE intentions have certainly weighed.
• GBP/USD closed 2013 at 1.6563 and now trades at 1.5580: down 5.93%. Growth looked strong for some time, but inflation looks weak.
• USD/JPY closed 2013 at 105.34 and now trades at 119.50: up 13.44%. If the huge QE move of 2013 wasn’t enough, another big bang came along in 2014 and the government also fuels this.
• AUD/USD closed 2013 at 0.8923 and now trades at 0.8191: down 8.2%. Rising unemployment and worries about China took their toll.
• NZD/USD closed 2013 at 0.8226 and now trades at 0.7841: down 4.68%. The economy doesn’t look too shabby, but a pause in hikes meant a surrender to the dollar.
• USD/CAD closed 2013 at 1.0620 and now trades at 1.1589: up 9.12%. It’s all oil, that beat a relatively healthy local economy and also some inflation.

If we list these 7 currencies by relative strength we get this:

1. USD
2. NZD
3. GBP
4. AUD
5. CAD
6. EUR
7. JPY

And last but least: WTI Oil closed 2013 at $98.42 and now trades at $53.37: down over 40%.

Stay tuned for our upcoming podcast in which we preview 2015, where some trends could continue and some could reverse.

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