Dollar falls to weekly low as U.S. government shutdown rattles markets

The U.S. dollar fell to a one-week low against major currencies on Wednesday, October 1, as the government shutdown unsettled markets and threatened to delay key jobs data considered critical for Federal Reserve policy, Reuters reported.

The pressure on the greenback was also linked to mixed JOLTS labor market survey data showing only a slight increase in job openings in August, while hiring slowed, pointing to labor market weakness.

The dollar index, which tracks the U.S. currency against six major peers, slipped 0.2%. The dollar dropped 0.5% against the yen, nearing its lowest in two weeks, and fell 0.2% against the Swiss franc.

Jane Foley, chief FX strategist at Rabobank, told Reuters it was unclear whether the yen’s strength came from safe-haven demand or speculation over possible rate hikes by the Bank of Japan.

On September 29, the dollar had already weakened on shutdown fears, with the index down 0.22% to 97.90. Investors worry the greenback typically softens ahead of such events and recovers once budget disputes are resolved.

The shutdown, the third under President Donald Trump, began October 1 after Congress failed to pass a funding bill in time for the new fiscal year.