US Dollar Index attracts some sellers below 98.00 as US government risks shutdown

• US Dollar Index tumbles to near 97.95 in Monday's Asian session.
• Trump will meet with the top leaders in Congress later on Monday to discuss extending government funding.
• Traders brace for the Fedspeak for more cues on the US interest rate path. 

The US Dollar Index (DXY), an index of the value of the US Dollar (USD) measured against a basket of six world currencies, trades on a stronger note around 97.95 during the Asian trading hours on Monday. The DXY declines amid the growing risk of a US government shutdown. 

US President Donald Trump will meet with Democratic and Republican leaders at the White House on Monday as the deadline for a possible government shutdown looms. Without funding legislation, parts of the government would close on Wednesday, the first day of the US government's 2026 fiscal year. The US government shutdown risks could exert some selling pressure on the US Dollar against its rivals in the near term. 

The US Personal Consumption Expenditures (PCE) Price Index, the Federal Reserve's (Fed) preferred inflation gauge, rose 2.7% YoY in August versus 2.6% in July, the US Bureau of Economic Analysis reported Friday. Meanwhile, the core PCE Price Index, which excludes volatile food and energy prices, climbed 2.9% YoY in August, matching July's increase and analysts' estimate. On a monthly basis, the PCE and the core PCE increased 0.3% and 0.2%, respectively.

Markets imply a 90% odds of a Fed rate cut in October, with nearly a 65% chance of another reduction in December, according to the CME FedWatch Tool. Fed officials are set to speak later on Monday, including Fed Governor Christopher Waller, Cleveland Fed President Beth Hammack, St. Louis Fed President Alberto Musalem, New York Fed President John Williams and Atlanta Fed President Raphael Bostic. Any hawkish remarks from policymakers could help limit the USD's losses.