The dollar index (DXY00) on Wednesday fell from a 1-week high and finished down by -0.04%. The dollar relinquished early gains on Wednesday and turned lower after a Reuters report stated that the Trump administration is considering broad restrictions on exports to China made with US software in retaliation for China's latest round of rare earth export restrictions. The ongoing shutdown of the US government is also bearish for the dollar. 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 rallied to a 1-week high on Wednesday due to the weakness of the British pound. (GBP/USD) fell to a 1-week low on Wednesday due to a weaker-than-expected UK Sep CPI report, which could push the BOE to cut interest rates.
