Investing.com - The dollar pushed higher against a basket of other major currencies on Tuesday, as downbeat economic reports from the euro zone added to concerns over the outlook for global economic growth, boosting safe haven demand.
USD/JPY edged up 0.10% to 106.95, pulling away from one-month lows hit overnight.
The safe-haven yen strengthened recently after the International Monetary Fund cut its forecasts for global growth in 2014 and 2015 last week and warned that global growth may never reach its pre-crisis levels ever again.
Markets were also jittery amid the widening Ebola epidemic. The U.K. announced on Monday that it will begin conducting fever tests for Ebola at Heathrow airport, after Health Secretary Jeremy Hunt said it is likely that the virus will be diagnosed in the U.K. by end of year.
EUR/USD dropped 0.79% to 1.2650 after data showed that German economic sentiment deteriorated to the lowest level since December 2012 in October, fuelling further concerns over the euro zone's largest economy.
The ZEW Centre for Economic Research said that its index of German economic sentiment fell by 10.5 points to minus 3.6 this month from September’s reading of 6.9. Analysts had expected the index to decline by 5.9 points to 1.0 in October.
The index of euro zone economic sentiment plunged to 4.1 in September from 14.2 in August, below expectations for a decline to 7.1.
A separate report showed that industrial production in the euro zone declined 1.8% in August, confounding expectations for a 1.6% fall. July's figure was revised to a 0.9% rise from a previously estimated 1.0% increase.
The pound fell to 11-month lows, with GBP/USD at 1.5926, down 0.98% for the day after data showed that U.K. inflation data slowed to a five-year low in September.
The U.K. Office for National Statistics said the rate of consumer price inflation slowed to 1.2% last month from 1.5% in August. Analysts had expected U.K. CPI to fall to 1.4% in September.
Month-over-month, consumer price inflation was flat in September, after rising 0.4% in August.
Core CPI, which excludes food, energy, alcohol, and tobacco costs rose at a rate of 1.5% last month, down from 1.9% in August. Analysts had expected core prices to rise 1.8% in September.
Meanwhile, USD/CHF advanced 0.75% to trade at 0.9549. Data earlier showed that Swiss producer price inflation slipped 0.1% last month, in line with expectations, after 0.2% fall in August.
The commodity linked dollars were broadly weaker, with AUD/USD sliding 0.34% to 0.8744 and NZD/USD shedding 0.30% to trade at 0.7870, while USD/CAD gained 0.40% to 1.1244.
The National Australia Bank reported on Tuesday that its index of business confidence fell to a five-month low of 5 in September from a reading of 7 in August, whose figure was revised down from a previously estimated reading of 8.
The US Dollar Index, which tracks the performance of the greenback against a basket of six major currencies, climbed 0.74% to 85.90.