Headline: US shutdown resolution could cool the dollar rally, says Credit Agricole
The strong run in the US dollar since October may be nearing a turning point as Washington moves to resolve the government shutdown. According to Credit Agricole, the reopening of agencies and a restart of official data releases could expose softer fundamentals that undermine recent bullish momentum in the greenback.
The bank notes that a fresh wave of economic reports—especially labor market indicators delayed by the shutdown—could challenge the hawkish repricing seen after the October FOMC meeting. Weaker employment or wage figures would likely temper expectations for tighter monetary policy, pressuring the US dollar against major peers in the forex market.
Beyond the data, Credit Agricole highlights a liquidity angle: as the Treasury reduces cash hoarding and normal funding operations resume, the temporary liquidity premium that supported the dollar may fade. With fiscal risk receding and safe-haven demand easing, currency markets could see a more balanced backdrop for USD performance in the near term.
Key Points: – Credit Agricole warns the end of the US government shutdown could stall the recent dollar rally. – Resumed economic data releases may reveal softer labor market trends. – A challenge to post-October FOMC hawkish repricing could weigh on the greenback. – Treasury normalization may reduce the dollar’s liquidity premium. – Easing fiscal risk could lessen safe-haven demand for USD. – FX traders are watching incoming data for signals on policy expectations and dollar direction.
Last updated on November 10th, 2025 at 09:50 am
