The dollar trades lower as US government shutdown deadline looms

Courtney Goldsmith
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Congress Continues To Work Toward A Continuing Resolution To Fund Government And Avoid Shutdown
The Senate could prevent a government shutdown today (Source: Getty)

The US dollar traded lower today ahead of a midnight deadline to fend off a government shutdown.

The dollar index, which measures the greenback against a basket of major currencies, was down 0.3 per cent after hitting an earlier low of 90.564, on track for its fifth week in the red.

Meanwhile, US 10-year Treasury yields hit their highest level in more than three years.

Read more: A year of President Trump: seven charts that reflect market reaction

The House of Representatives last night passed a month-long funding bill, but Republican and Democrat parties in the Senate were divided today.

If the funding bill is not signed by midnight, the government - and a number of federal agencies - will be forced to shut down.

“Late last night the House of Representatives passed concessions on a major increase in defence spending and a hard-line immigration bill. But Senate Democrats said they would likely block the measure unless President Donald Trump and Republicans include protection for young immigrants," said Miles Eakers, chief market analyst at Centtrip.

“An impasse could result in Trump celebrating his first anniversary in office with the first shutdown in four years, despite his party holding a majority in both houses. After reports of the vote, we saw continued, but muted, dollar weakness, pushing the GBP/USD pair back above $1.39 and EUR/USD nearer the $1.23 resistance level.”

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