The year 2023 witnessed a decline in the dollar index, which measures the performance of the US currency against six competing currencies, ending two years of gains.
The index recorded 101.44 in the latest trading, rising 0.059 percent, amid investors’ assessment of the possibilities of the Federal Reserve reducing interest rates this year.
The Japanese yen suffered the greatest damage from the rise of the dollar, as the Asian currency fell 0.35 percent to 141.36 yen to the dollar, after the yen fell seven percent in 2023.
Markets now expect 86 percent of the US Federal Reserve to cut interest rates starting in March, according to the CME Fed Watch tool, with interest rates expected to decline by more than 150 basis points this year.
The focus now turns to a number of economic data scheduled for release this week, including job vacancies and non-farm payrolls data.
Minutes from the Federal Reserve's most recent December meeting are due to be released on Thursday, and will provide a closer look at central bank officials' thinking about interest rate cuts this year.
The euro fell 0.13 percent to $1.103, moving away from the highest level in five months at $1.11395 that it touched last week.
The single European currency rose three percent last year, the first annual increase since 2020.
The pound sterling increased in the latest trading to $1.2729, up 0.05 percent during the day, after last year recorded its strongest performance since 2017, with an increase of five percent.
However, the weak economy and uncertainty surrounding the elections make a repeat performance unlikely.
On the other hand, the Australian dollar rose 0.35 percent to $0.68335.
The New Zealand dollar settled at $0.63155.
The world of cryptocurrencies began the year with a strong jump, as Bitcoin touched the highest level in 21 months at $45,532, amid growing expectations that the US Securities and Exchange Commission will soon approve the listing of Bitcoin spot trading funds.
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