US Session- Market Drivers: US Dollar Dips as Shutdown Fears and Rate Cut Buzz Take Hold

The US Dollar faced a turbulent start to the week, sliding to three-day lows near 97.80 on September 29, 2025, as concerns over a potential US government shutdown and expectations of Federal Reserve rate cuts weighed heavily on the currency. With the US labor market in the spotlight, investors are bracing for a pivotal week of economic data and central bank activity.

The Greenback’s decline was amplified by a pullback in US yields, setting the stage for key releases on Tuesday, September 30. Investors will closely monitor job openings data, housing price indices, manufacturing activity, consumer confidence, and weekly crude oil inventory reports. Meanwhile, several Federal Reserve officials are slated to speak, potentially offering clues about the central bank’s next moves.

In Europe, the euro capitalized on the Dollar’s weakness, climbing to around 1.1750. The eurozone’s consumer inflation expectations will be a focal point, alongside a series of speeches from European Central Bank officials, which could shed light on the region’s monetary policy outlook. Across the Channel, the British Pound advanced to 1.3460 but later eased slightly. The UK will release current account data, business investment figures, and final Q2 GDP growth numbers, with Bank of England officials also scheduled to speak.

The Japanese Yen saw renewed pressure, with the USD/JPY pair dropping to three-day lows near 148.50. Japan’s central bank will release its Summary of Opinions, alongside retail sales, industrial production, housing starts, and construction orders data, which could influence the Yen’s trajectory. Meanwhile, the Australian Dollar surged to a two-day high near 0.6580 ahead of the Reserve Bank of Australia’s meeting, where interest rates are expected to remain unchanged. Housing and credit data will also be in focus Down Under.

In commodities, US crude oil prices dipped below $64.00 per barrel due to renewed oversupply concerns. Conversely, gold soared to a record high near $3,830 per troy ounce, fueled by Fed rate cut expectations and shutdown fears. Silver also hit a milestone, breaking past $47.00 per ounce for the first time since May 2011, reflecting strong investor demand for safe-haven assets amid economic uncertainty.