Currencies: Dollar posts more than 9% annual gain as curtain falls on 2015

With most traders all but checked out for the final trading day of 2015, the dollar moved higher Thursday against most of its major rivals.

For the year as a whole, it has been anything but mundane for the greenback, which gained 9.3% for the year, aided by a 0.4% climb on New Year’s Eve, as gauged by the ICE Dollar Index DXY, +0.37% a measure of the dollar against six major currencies.

The dollar was up 0.7% at 1.0868 against the euro EURUSD, -0.6129% from 1.0933 late in New York. The buck’s biggest gains versus major rivals have come via the shared currency. Year-to-date, the dollar has advanced about 10% against the European currency.

Against the yen USDJPY, -0.28% the pair was at ¥120.23 in late trade in New York, down from ¥120.52 Wednesday. For the year, the dollar has gained just 0.4%.

This will mark the fourth straight year that the yen has dropped against the dollar, noted Marc Chandler, global head of currency strategy at Brown Brothers Harriman on his blog Marc to Market.

Some steam came out of the dollar rally in recent weeks after ECB stimulus measures announced at the start of this month fell short of market expectations. Still, traders are acutely aware that the ECB is in easing mode as the U.S. Federal Reserve is expected to embark on a campaign of higher interest rates, which started with a December hike.

Omer Esiner, chief market analyst Commonwealth Foreign Exchange, told MarketWatch that gains by the dollar against the euro on Thursday may be attributed to traders unwinding bets that the euro will rise and shifting focus on the prospects for the dollar.

“[Traders] are assessing the outlook for 2016 and the expectation is that the dollar once again will resume its longer-term strengthening trend,” he said.

Esiner also warned against trying to interpret fluctuations in currencies ahead of a New Year’s Day—a holiday for global markets—marked by low trading volumes.

Other strategists said crude oil will continue to be a big driver for currencies, looking ahead. Crude prices fell more than 30% in 2015, marking a tumultuous year for the commodity. Analysts see few positive catalysts for oil heading into 2016.

Over the year, weak oil prices have crushed commodity-linked currencies. Against the Canadian dollar, the U.S. dollar USDCAD, -0.3170%  has gained nearly 20% to $1.3861, with the dollar adding another 3.6% this month alone. The greenback also gained against oil-rich Russia, which saw the ruble fall to its lowest level all time. The buck was at 72.9996 against the ruble late in New York, down from 73.52 late Wednesday and has climbed almost 21% against the Russian currency.

Read: The dollar could take one of these three paths in 2016

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