Dollar on Course
for Worst Year Since 2017 as Euro, Pound Post Robust Gains

Singapore, 31 Dec
2025 (ONA) — The U.S. dollar steadied today but remained on track to post its
steepest annual decline since 2017. The currency’s weakness throughout 2025 has
been fuelled by successive interest rate cuts and persistent market anxiety
over the nation’s fiscal trajectory and the volatile trade policies of the
Trump administration.

These concerns
are expected to linger into 2026, indicating the dollar’s subdued performance
may continue, thereby providing support to rival major currencies. The euro and
British pound sterling, which have registered substantial gains this year
(2025), stand to benefit from this dynamic. Further pressure on the dollar
stems from ongoing doubts about the operational independence of the U.S.
Federal Reserve under the current political climate. President Trump has stated
he will announce his nominee for Fed Chair in January, a position that will
succeed Jerome Powell, whose term ends in May.

With Japanese
markets closed for the week and most major financial centers shut tomorrow (Thursday)
for the New Year holiday, trading activity is expected to be exceptionally
light. In thin year-end trading, the euro held steady at $1.1747 and the pound
at $1.3463. Both currencies are poised to record their strongest annual
performances in eight years.

The U.S. dollar
index, which measures the greenback against a basket of six major peers, was
flat at 98.228, clinging to modest gains from the previous session. For the
year, the index has fallen 9.5 percent, while the euro has surged 13.5 percent
and the pound has advanced 7.6 percent.

— Ends/Khalid