US Dollar Weakens Against Major Currencies as US Bond Yields Slow

Key summary

The US dollar declined against major currencies in New York foreign exchange trading on Tuesday (October 20) following a slowdown in US Treasury yields. The Dollar Index, which measures the dollar's value against a basket of six major currencies, fell 0.27% to 101.701. The dollar weakened against the yen at 158.20 yen from 158.52 yen on Monday (October 19), the Swiss franc at 0.8248 francs from 0.8265 francs, and the Canadian dollar at 1.4057 CAD from 1.4106 CAD. Conversely, the euro strengthened to 1.1237 dollars from 1.1212 dollars, and the British pound rose to 1.3383 dollars from 1.3305 dollars. US Treasury yields dropped after the Commerce Department reported that new home starts fell 5.2% to 1.221 million units in September, missing analyst forecasts of 1.300 million units and dropping from August's 1.288 million units; this decline was attributed to rising mortgage interest rates. Building permits also decreased 0.2% to 1.400 million units in September but remained above the forecasted 1.390 million units, up from August's 1.403 million units. Investors are now focusing on the upcoming Federal Reserve meeting and the release of Personal Consumption Expenditures (PCE) data, a key inflation metric for the Fed.