The dollar index (DXY00) on Monday rose by +0.39% and posted a 1-week high. The dollar moved higher on Monday after French Prime Minister Lecornu resigned, which undercut the euro. Also, the yen tumbled against the dollar after Sanae Takaichi, a proponent of easy fiscal and monetary policy, won Saturday's election to become Japan's new prime minister. Higher T-note yields on Monday also strengthened the dollar's interest rate differentials.
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, and GDP growth will stagnate, a negative factor for the dollar.
