US Dollar Index hovers around 99.50 before US House vote on government shutdown bill

• US Dollar Index steadies as traders adopt caution ahead of US House vote on bill to end government shutdown.
• The Greenback struggled as weaker ADP labor data reinforced expectations of Fed policy easing.
• Private employers cut an average of 11,250 US jobs per week in the four weeks to October 25.

The US Dollar Index (DXY), which measures the value of the US Dollar (USD) against six major currencies, is remaining flat after five days of losses and trading around 99.50 during the European hours on Wednesday. Traders will likely observe the upcoming speeches from Federal Reserve (Fed) officials, including Christopher Waller, Raphael Bostic, and Stephen Miran, later in the day.

The US Senate completed its job and passed the bill that would end the government shutdown. The House will vote on the bill on Wednesday, sending it to US President Donald Trump for signature. That would reopen the government, sending paychecks and unleashing economic data releases. On Monday, Trump already backed a bipartisan deal to end the US government shutdown, signaling a likely reopening within days.

However, the Greenback faced challenges as weaker-than-expected Automatic Data Processing (ADP), on Tuesday, employment data increased the likelihood of Federal Reserve (Fed) policy easing. The CME FedWatch Tool shows markets pricing in nearly a 66% chance of a 25-basis-point Fed rate cut in December, up from 62% a day ago.

Private employers shed an average of 11,250 jobs per week in the United States on average in the four weeks ending October 25, compared with 14,250 previously. The report suggested the labor market slowed in the second half of October, compared with earlier in the month.