The dollar fell to its lowest in over three months against a basket of major currencies on Friday, marking its steepest annual drop since 2003, on doubts over durability of a pickup in U.S. economic growth in wake of last week's tax overhaul.\r\nOne of the most dramatic market developments in 2017 was the breath-taking rise of bitcoin BTC=BTSP and other cryptocurrencies. While they have pulled back at year-end, many of these digital currencies have surged in value this year.\r\nThe greenback may lag further against its peers in 2018 as investors expected other major central banks to reduce their stimulus while the Federal Reserve has signaled it would raise interest rates further, analysts said.\r\n"The dollar will face more headwinds in 2018," said Chris Gaffney, President of World Markets at EverBank in St. Louis, Missouri. "The Fed won't be going at it alone in terms of taking off more gas from the stimulus pedal."\r\nBets the European Central Bank might consider raising interest rates by the end of 2018 due to evidence of higher inflation and business activity in the euro have lifted the euro, which was poised for its best yearly performance versus the greenback in 14 years.\r\nThe euro hit a three-month peak at $1.2028EUR= , bringing its annual gain to 14.2 percent. It was last up 0.56 percent at $1.2008.\r\nThe euro's rally was a drag on the greenback in 2017. The index that tracks the dollar versus the euro and five other major currencies .DXY fell as low as 92.080, which the lowest since Sept. 22. It recorded a 9.8 percent annual decline, the biggest yearly loss since 2003.\r\nThe dollar also weakened against the yen JPY= , sterling GBP=D4 , Canadian dollar CAD=D4 , Swedish crown SEK= and Swiss franc CHF= , which are the other index components this year.\r\nThe dollar index was at a 14-year peak at the start of 2017 on hopes for U.S. President Donald Trump's pro-growth economic agenda. Barring the most dramatic rewrite of the U.S. tax code in 30 years enacted last week, Trump and Republican lawmakers have struggled to pass legislation.\r\nFurthermore, many institutional investors close their books at the year-end, a deadline for taxation and performance reporting, a time seen leading to dollar selling pressure, analysts said.\r\nOutside of traditional currencies, bitcoin and other cryptocurrencies rebounded after two days of losses tied partly to more regulators toughening rules on digital currencies in a bid to curb excessive speculation.\r\nBitcoin was last up 1.18 percent at $14,564.76 on the Bitstamp exchange. It was off the record highs near $20,000 touched 12 days ago but still headed for a gain of roughly 1,400 percent in 2017.\r\nReuters.