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USD mixed as risk mood brightens – Scotiabank

The US Dollar (USD) is starting the new week out on a mixed note. News of a potential breakthrough in government shutdown negotiations in the Senate has lifted risk appetite and boosted stocks, Scotiabank’s Chief FX Strategists Shaun Osborne and Eric Theoret report.

🔗 Source

💡 DMK Insight

The USD’s mixed start reflects shifting risk sentiment as shutdown talks progress. With potential government shutdown negotiations gaining traction, traders should keep an eye on how this impacts the USD’s strength against major currencies. A resolution could lead to a risk-on environment, pushing the dollar lower as investors flock to equities. Conversely, if talks stall, we might see the USD regain strength as a safe haven. Watch for key levels around recent highs and lows in the USD index, as these will signal market sentiment shifts. Additionally, monitor correlated assets like equities and commodities, which could react strongly to any news on the negotiations. The upcoming week will be crucial; volatility is likely as traders position themselves ahead of any announcements.

📮 Takeaway

Watch for USD index levels closely; a breakthrough in shutdown talks could weaken the dollar, while delays may strengthen it as a safe haven.

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