2004 curency market report

2004 has been a monumental year in the currency markets. Dollar weakness was the predominant theme as the world's premiere reserve currency slid to a fresh all-time low against the euro, a nine-year low against the Swiss franc and a 12-year low against the British pound. 2004 also marked the beginning of the global tightening cycle, with many central banks raising rates for the first time since reducing them to extremely accommodative levels. The US current account deficit became a primary point of focus. I expect these themes to resonate into 2005, especially the earlier half. However, growth should also become a primary focus as the world monitors the strength of the US economic recovery.