We study the annual variation in solar wind speed at Earth's orbit and in geomagnetic activity since mid-1960's. The two parameters depict a very similar annual variation during the whole period. Annual variation has maximum amplitude around sunspot minima. The phase of annual variation reverses soon after solar maxima, following the Sun's polarity reversal and indicating a new type of 22-year periodicity. Stronger solar wind is found at or close to the Earth's highest northern (southern, resp.) heliographic latitudes during solar minima with a negative (positive) magnetic polarity. This implies an asymmetric SW speed distribution across heliographic equator such that the minimum speed region during solar minimum times is displaced away from heliographic equator towards the northern magnetic hemisphere. This may result e.g. from a systematically larger extension of polar coronal holes from the Sun's magnetic south pole toward solar equator. We exclude the earlier explanations proposed for annual variation, such as accumulation of small comets within 1 AU, or internal solar variation. ¿ 1998 American Geophysical Union