Dollar rebounds slightly as trade concerns ease
2025-10-22 13:29:34
The US dollar index (DXY) fell to around 98.90 during the European session on Wednesday, continuing its downward trend after three days of gains. The decline in the US dollar was mainly due to the US government shutdown and policy uncertainty.
The U.S. government shutdown has entered its 22nd day. The Senate failed to pass the appropriations bill proposed by the House of Representatives for the 11th time on Monday. The voting results were mainly along party lines, indicating that the legislative deadlock is still continuing.
The government shutdown not only affects fiscal operations, but also suspends the release of important data from the Bureau of Labor Statistics and the Census Bureau, increasing market concerns about the lack of economic data. At the same time, it limits the reference for the Federal Reserve's policy decisions and weakens investors' confidence in the US dollar.
Institutional view: According to market research, Federal Reserve fund rate futures have almost fully priced in the possibility of a 25 basis point rate cut at the October 29 meeting. The rise in short-term interest rate expectations reflects market pressure on the US dollar.
On the other hand, positive signs in global trade sentiment provided some support to the US dollar.
On the daily chart, the US dollar index is under short-term pressure, with key support at 98.70 and secondary support at 98.20. Resistance levels are at 99.20 and 99.50. Technical indicators suggest short-term weakness, but a rebound is possible if support holds and trade negotiations progress.
MACD showed signs of decline, and RSI fell from a high level to around 50, indicating that short-term fluctuations were weak.
Editor's opinion:
The US dollar is under short-term pressure primarily due to the government shutdown and policy uncertainty. The market is sensitive to missing economic data and expectations of interest rate cuts, resulting in a clear short-term weakness. However, global trade sentiment has alleviated some downward pressure. The stability of the 98.70 support level will be monitored to determine the direction of a short-term US dollar rebound or further correction.
The U.S. government shutdown has entered its 22nd day. The Senate failed to pass the appropriations bill proposed by the House of Representatives for the 11th time on Monday. The voting results were mainly along party lines, indicating that the legislative deadlock is still continuing.
The government shutdown not only affects fiscal operations, but also suspends the release of important data from the Bureau of Labor Statistics and the Census Bureau, increasing market concerns about the lack of economic data. At the same time, it limits the reference for the Federal Reserve's policy decisions and weakens investors' confidence in the US dollar.Institutional view: According to market research, Federal Reserve fund rate futures have almost fully priced in the possibility of a 25 basis point rate cut at the October 29 meeting. The rise in short-term interest rate expectations reflects market pressure on the US dollar.
On the other hand, positive signs in global trade sentiment provided some support to the US dollar.
On the daily chart, the US dollar index is under short-term pressure, with key support at 98.70 and secondary support at 98.20. Resistance levels are at 99.20 and 99.50. Technical indicators suggest short-term weakness, but a rebound is possible if support holds and trade negotiations progress.
MACD showed signs of decline, and RSI fell from a high level to around 50, indicating that short-term fluctuations were weak.
Editor's opinion:
The US dollar is under short-term pressure primarily due to the government shutdown and policy uncertainty. The market is sensitive to missing economic data and expectations of interest rate cuts, resulting in a clear short-term weakness. However, global trade sentiment has alleviated some downward pressure. The stability of the 98.70 support level will be monitored to determine the direction of a short-term US dollar rebound or further correction.
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