The dollar Wednesday resumed its slump on concerns about the nation's ability to fund its trade and budget deficits.
But stock and bond markets were largely untroubled by the dollar's woes, or by a sharp rebound in oil prices on worries about U.S. supplies.
Key stock indexes inched up and long-term Treasury bond yields fell to their lowest levels in at least six weeks.
The dollar slid even though President Bush, speaking to reporters after a meeting with Italian Prime Minister Silvio Berlusconi, reiterated his support for a strong currency. Bush signaled that his administration wanted to reduce the trade and budget deficits that many economists say are largely responsible for the dollar's weakness.
Bush pledged to do "everything we can in the upcoming legislative session to send a signal to the markets that we'll deal with our deficit, which, hopefully, will cause people to want to buy dollars." Bush also suggested that the Federal Reserve's campaign since June to raise short-term interest rates was an effort to bolster the dollar.
The Fed on Tuesday raised its key rate a quarter point to 2.25%, the fifth increase this year. Bush said that was "a signal to the world markets that [Fed Chairman Alan Greenspan] is also aware of the relative currency valuations between the euro and the dollar."
But the greenback lost ground as some currency traders focused on the latest monthly report on the flow of money into and out of U.S. securities.
The nation's net capital inflow for the month was $48.1 billion, down from $67.5 billion in September and the smallest total since October 2003, Treasury data showed.
The net capital inflow figure measures what foreigners invest in U.S. long-term securities after adjusting for what Americans send abroad through their purchases of foreign securities.
Overall foreign demand for U.S. stocks and bonds in October was nearly the same as September, at a net inflow of $63.3 billion, the Treasury said.
The surprise in the October report was a jump in U.S. investment in foreign securities. Americans bought a net $12 billion in foreign stocks, for example, after being net sellers of foreign shares in September.
The falling dollar has boosted Americans' returns on foreign stocks and bonds this year because those securities are worth more when translated from stronger currencies back into dollars, analysts note.
