The US Dollar steadied after a three-day decline, buoyed by the Senate’s progress on a deal to end the government shutdown. However, persistent concerns about consumer sentiment and uncertainties surrounding future Federal Reserve policy decisions continue to weigh on the currency.
- Dollar index steadied around 99.6 after falling for three straight sessions.
- The Senate passed the initial stage of a deal to end the government shutdown.
- The agreement provides funding for several departments through Jan. 30 but doesn’t include key Democratic demands regarding Affordable Care Act tax credits.
- The University of Michigan’s consumer sentiment index fell to its lowest level in nearly three and a half years.
- Markets remain divided on whether the Federal Reserve will cut rates in December, with traders pricing in roughly a 67% chance of a quarter-point reduction.
The mixed news suggests the dollar’s near-term direction remains unclear. While the easing of the government shutdown provides some support, underlying economic anxieties and the potential for future interest rate cuts create headwinds. The balance between these factors will likely determine the dollar’s trajectory.