00:00 Japan Bank holiday

The dollar touched a five-year high versus the yen and headed for an annual gain against major peers amid optimism a sustained U.S. economic recovery will allow the Federal Reserve to cease bond purchases by the end of 2014.

The Bloomberg U.S. Dollar Index is set for its biggest annual advance in five years before reports this week that may show improvements in housing and manufacturing. Pending home sales in the U.S. probably gained 1 percent in November from the previous month, when they fell 0.6 percent, according to the median estimate of economists surveyed by Bloomberg News before today’s report by the National Association of Realtors. The S&P/Case-Shiller index of property prices in 20 cities climbed 13.5 percent in October from a year earlier, a separate poll showed ahead of figures due tomorrow.

The Institute for Supply Management may say on Jan. 2 its gauge of manufacturing in the world’s biggest economy was at 56.9 this month, indicating continued expansion after growing in November at the fastest pace in more than two years.

The euro is poised for the strongest advance among major developed currencies as European Central Bank officials damp prospects for interest-rate cuts. ECB President Mario Draghi sees no need for further cuts to the institution’s benchmark rate amid “encouraging signs” that the euro crisis may be resolved, Der Spiegel reported, citing an interview published Dec. 28. Policy makers in the region lowered the key rate last month by a quarter-percentage point to a record low of 0.25 percent.

Japan’s yen was poised for a yearly slide versus most major counterparts as Asian stocks strengthened, curbing demand for haven assets.

EUR / USD: during the Asian session, the pair traded in the range of $ 1.3725-70

GBP / USD: during the Asian session, the pair traded in the range of $ 1.6465-00

USD / JPY: during the Asian session, the pair rose to Y105.40