Dollar deepens losses, dives to 3-week low

The US dollar fell against a basket of currencies on Tuesday, deepening losses for the fifth straight day, and hit a 3-week low, after the release of weak data on industrial production in the US, and a drop in the US Treasury bond yields, which dampens demand for the US dollar.

The dollar index fell 0.5% to the lowest since September 28 at 93.50 points, after opening at 93.94 points, and hit a high at 93.95 points.

The index lost less than 0.1% yesterday, the fourth straight daily loss, after the release of weak economic data.

Data showed yesterday that the US industrial production index contracted by 1.3% during September, worse than forecasts of a growth by 0.3%, and worse than August's reading of a contraction by 0.1% after it was revised from 0.4% growth.

This contraction came due to the global shortage of semiconductors, which slowed down car production and renewed doubts about the US economic growth pace during the second half of 2021.

The 10-year US Treasury yield fell 2.5% today, to head for the first loss in 3 days, which weighs down on demand for the US dollar.