Dollar Dips Amid Economic Data and Government Shutdown Fears
The U.S. dollar fell against major currencies due to stronger economic data and looming government shutdown fears. Economic reports led to a retreat in expectations for Federal Reserve rate cuts. The government shutdown threat adds uncertainty as traders anticipate upcoming economic data and global currency impacts.
The U.S. dollar took a hit on Monday, sliding against major counterparts like the euro and yen. This came after last week's rally fueled by unexpectedly strong U.S. economic data. Investors are now looking ahead to the critical nonfarm payrolls report for further Federal Reserve policy signals.
Higher-than-expected data on housing, durable goods, and GDP revisions, alongside a sharp drop in jobless claims, have shifted expectations for Federal Reserve interest rate decisions. Adding to the dollar's slide is the potential risk of a government shutdown, as funding is set to expire at midnight on Tuesday, prompting President Trump to meet with congressional leaders in a bid to prevent it.
Market analysts express concerns that a shutdown would increase economic uncertainty, as the Labor Department confirmed it would halt economic data releases, including the significant monthly employment report. The dollar's decline has triggered movements across global currencies, as traders anticipate further economic indicators and geopolitical developments.
(With inputs from agencies.)
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