If someone asks how things are going, "hunky dory" is a cheerful, easy way to communicate that things are going just fine. Its origin story is a little less straightforward.
The phrase dates back to the 1860s, although no one is quite sure where the “dory” part came from. One theory suggests a Japanese connection, perhaps a street there frequented by sailors, but there isn't convincing evidence for that. A more likely possibility is that “dory” is simply a meaningless reduplication, like the “dokey” in “okey-dokey.”
“Hunky” has a more traceable history. In 19th-century New York, children playing tag used the Dutch word “hunk” for home base. You could be “on hunk” or “reach hunk,” meaning you were safe.
By the 1850s, “hunk” was being used as an adjective to mean ”safe” or “in a good position,” and by the 1860s “hunky” could mean “safe and sound” or “in good condition.”
Green’s Dictionary of Slang has evidence for “hunky-dory” as far back as 1863, while the Oxford English Dictionary has it back to 1866. There have been variations over the years, including “honky-dooley,” “hunky-dunky” and “hunky-dokey.”
While “hunky” might now make you think of an attractive, ruggedly handsome man, that meaning didn't appear until the 1960s. That same decade brought us “peachy keen,” another way of saying things are going well.
There are plenty of other ways to say you're doing just fine, including “right as rain.” For more on that expression and others, listen to the audio above.