USD Index turns highly volatile near 99.50 after Trump's bill advances to Senate

• The USD Index demonstrates high volatile action near 99.50 as the US House of Representatives passes Trump's tax bill.
• Trump's tax cut bill is expected to accelerate the US fiscal crisis
• Last week, Moody's downgraded the US credit rating to Aa1.

The US Dollar (USD) exhibits volatile action during North American trading on Thursday, with the US Dollar Index (DXY) showing wild moves near 99.50 after the United States (US) House of Representatives approved President Donald Trump's tax bill narrowly and passed it to the Senate.

After getting passage from the lower house of Congress, US President Trump stated that the "one big beautiful bill is the most significant legislation" and added that "It's time for friends in the United States Senate to get to work".

While US President Trump has cheered the approval of the so-called "big beautiful bill" in the House of Representatives, financial market participants are worried that the bill, which comprises tax cuts and spending plans, will exacerbate the fiscal deficit crisis. According to the nonpartisan Congressional Budget Office, Trump's new bill would increase the US debt by $3.8 trillion over the decade, exacerbating interest obligations for the administration.

Last week, Moody's also cited concerns over large fiscal imbalances and increasing interest costs and downgraded the US Sovereign Credit Rating by one notch to Aa1 from Aaa.

On the economic front, investors await the flash US S&P Global Purchasing Managers' Index (PMI) data for May, which will be published at 13:45 GMT.

Meanwhile, Initial Jobless Claims for the week ending May 16 have come in slightly lower than projected. Individuals claiming jobless benefits for the first time were recorded at 227K, slightly fewer than estimates of 230K and the prior release of 229K.