The US dollar had its worst week since early September as the financial market rally prompted investors to ditch the greenback temporarily. With expectations that the Federal Reserve will slow down the pace of interest rate increases next year, investors poured into equities, resulting in substantial gains in the leading benchmark indexes.

It was a week of mixed economic data for the United States. Industrial and manufacturing production advanced at a healthy clip of 0.4% in September, while initial jobless claims plunged to 214,000 for the week ending October 15.

However, the US real estate market deepened its recession, as existing home sales tumbled 1.5% to 4.71 million units and mortgage applications dropped 4.5% for the week ending October 14. This comes as the 30-year mortgage rate topped 7% for the first time since the early 2000s.

Moreover, the Fed Bank of Philadelphia and the NY Empire State Manufacturing Indexes worsened as they expanded their contraction stance. In addition, the CB Leading Index dropped 0.4% in September.

Despite the abysmal data, the stock market indexes post big gains, with the Dow Jones Industrial Average surging about 750 points. The Nasdaq Composite Index and the S&P 500 rose more than 2.3% each.

This did not help the greenback as the US Dollar Index (DXY), which measures the greenback against a basket of currencies, fell 0.89% to 111.88, from an opening of 112.88. The index posted a weekly loss of 1.27%, paring its year-to-date gain to below 17%.

The US Treasury market was mixed, with the benchmark ten-year yield down 0.7 basis points to 4.219%. The one-year bill shed 6.1 basis points to below 4.6%, while the 30-year bond added 12.2 basis points to 4.337%.

The USD/CAD currency pair declined 0.87% to 1.3646, from an opening of 1.3767. The EUR/USD advanced 0.78% to 0.9864, from an opening of 0.9789.