Investing.com - The greenback rose on Tuesday as bond yields bounced back, easing worry over the health of the U.S. economy in spite of weak housing data.
The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, rallied 0.2% to 96.213 as of 11:03 AM ET (15:03 GMT).
The yield on the benchmark United States 10-Year note was at 2.435%. Worry about an inverted bond yield subdued as analysts remarked that inversions must last a long time for it to truly forecast a recession.
Still, weak data pointed to a troubled housing sector in the U.S., which is a leading indicator of the economy. Housing starts tumbled 8.7% to a seasonally-adjusted annual rate of 1.162 million units last month, the Commerce Department said, well below a consensus forecast for 1.213 million units.
The numbers question whether the Federal Reserve’s extended pause on rate hikes last week will help the struggling sector.
The Fed has taken a step back on interest rates, as policymakers are concerned about domestic and global growth.
The dollar rose against the safe-haven yen, with USD/JPY rising 0.05% to 111.46.
The pound was slightly higher as U.K. lawmakers took control of the Brexit process from Prime Minister Theresa May, paving the way for alternatives to the deal May made with Brussels. GBP/USD rose 0.1% to 1.3214.
Elsewhere, AUD/USD was up 0.4% at 0.7138 while NZD/USD gained 0.1% to 0.6909. The loonie rose, with USD/CAD falling 0.1% to 1.3390 and EUR/USD inched down 0.3% to 1.1278.