US Government Shutdown Pushes Dollar Lower for Fourth Day

Group 1 - The US dollar has dropped to its lowest point in a week due to the first government shutdown in nearly seven years and negative private-sector payroll growth [1][4] - The Bloomberg Dollar Spot Index fell by 0.2% and is on track for a fourth consecutive day of declines, with the yen leading gains against the dollar [1][2] - Traders are preparing for further weakness in the dollar, as indicated by risk reversals showing a preference for bearish trades [2] Group 2 - Private-sector payrolls fell by 32,000 in September, contrasting with an expected increase of 51,000, leading to a downward revision of prior data [4] - Following the negative payroll data, Treasuries gained, with the two-year yield dropping six basis points to 3.55%, and traders are betting on at least two interest-rate cuts from the Federal Reserve this year [5] - A prolonged government shutdown is expected to increase pressure on the dollar, which has already declined to its lowest level since 2022 due to concerns over policy making and escalating deficits [6] Group 3 - The ADP payroll release is significant as it is likely to be the highest profile reading of the US labor market for the week, with the government's jobs report delayed by the shutdown [7]