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Session Recap: USD weakens as shutdown begins

FXstreet.com (Córdoba) - The USD weakened broadly Tuesday as the US government entered a partial shutdown after lawmakers failed to agree on funding for the fiscal year that began just after midnight.

For the first time in 17 years, parts of the US Federal Government have shut down due to political impasse. In the absence of a spending bill, thousands of government workers will be furloughed, national parks will be closed and other government's services will be affected.

EUR/USD reached a fresh 8-month high of 1.3587 but lost momentum and pulled back weighed by soft Eurozone data. GBP/USD scored a 10-month peak of 1.6259 before easing a tad. USD/JPY slumped back below 98.00.

The Australian dollar is among best performers as the RBA left policy unchanged and dropped its reference to an elevated AUD. AUD/USD has climbed nearly 150 pips throughout the day and hit a high of 0.9434.

During the New York session, traders will be watching the US PMI, the ISM manufacturing index and construction spending in an event-heavy week ahead of the key NFP report Friday.

Main Headlines in Europe:

Switzerland: SVME - PMI expands further in September

European open: US and Europe continue fight to the bottom

Commodities tumble after “Stoptober”

Germany: Unemployment Rate up to 6.9% in September

Germany: PMI Manufacturing down to 51.1 in September

EMU: PMI Manufacturing at 51.1 in September, as expected

UK: PMI Manufacturing slides to 56.7 in September

Flash: What’s the sentiment around the EUR/USD today? – Danske Bank and Commerzbank

EMU: Unemployment Rate unchanged at 12% in August

Not a Letta confidence in Italy

USD/JPY - Abe hikes sales tax and announces stimulus, but is it enough?

PM Abe announces huge boost in Japan’s economy as of ¥5trillion

About an hour earlier the Prime Minister of Japan Abe, announced that the Japanese government will inject an economic stimulus package worth around 5 trillion yen ($50.96 billion) to cushion the impact from the sales tax hike planned next April.
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EUR/USD keeps correcting sub-1.3550

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