The dollar index (DXY00) on Wednesday fell from a 5.25-month high and finished down by -0.05%. The dollar gave up its advance on Wednesday and posted modest losses after stocks recovered following Tuesday's rout, which dampened liquidity demand for the dollar. Also, the dollar is still under pressure from the ongoing US government shutdown. The longer the shutdown is maintained, the more likely the US economy will suffer and the more likely the Fed will have to cut interest rates.
The dollar initially moved higher on Wednesday after the US Oct ADP employment change rose more than expected, a hawkish factor for Fed policy. The dollar raced tits high on Wednesday when the Oct ISM services index rose more than expected to an 8-month high.
