The dollar index (DXY00) today is up by +0.21% and posted a new 1.75-month high. Political risks in France and Japan are undercutting the euro and yen, respectively, to the benefit of the dollar. Higher bond yields today and weakness in stocks are also supporting the dollar. However, gains in the dollar are limited by dovish comments from New York Fed President John Williams, who said he would back "lower rates this year" if the economy evolved as expected.
The ongoing shutdown of the US government is bearish for the dollar as the shutdown entered its second week on Monday. The longer the shutdown is maintained, the more likely the US economy will suffer, a negative factor for the dollar.
