The dollar index closed at 99.6 on Friday, a one-percent monthly decline that brings the year-to-date depreciation against major peers to 6.4 percent.

Emerging-market currencies have been the standout beneficiaries. The Brazilian real, Mexican peso, Indian rupee and South African rand are all up between 4 and 9 percent year-to-date, drawing renewed institutional interest in EM local-currency debt.

Strategists are divided on whether the move represents the beginning of a multi-year dollar bear market or a tactical correction within a structural bull cycle. Brad Setser of the Council on Foreign Relations argues that current account fundamentals support the former interpretation.

Asian central banks, which had spent much of the past two years defending their currencies against an ascendant dollar, have used the reprieve to rebuild reserves quietly. People's Bank of China holdings rose by $36 billion in April.