U.S Market News: ING Analysts Warn of Downside Risks for the US Dollar Amid Government Shutdown and Dovish Fed Outlook

Key Takeaways:ING analysts say the US dollar remains resilient but faces downside risks.The ongoing US government shutdown could delay key economic data releases.Markets await the Federal Reserve meeting minutes to assess policymakers’ stance on future rate cuts.According to Jinshi Data, Francesco Pesole, FX strategist at ING Bank, warned that while the US dollar (USD) has shown resilience in recent sessions, it now faces growing downside risks amid mounting political and economic uncertainty in the United States.Pesole noted that limited progress on resolving the US government shutdown will likely delay the release of crucial economic data, making it harder for markets to gauge the strength of the US economy. This uncertainty, combined with expectations of further monetary easing by the Federal Reserve, could weigh on the dollar in the near term.Investors are now turning their attention to the Federal Reserve’s meeting minutes, set to be released later this week, to determine whether Chair Jerome Powell’s dovish tone on potential rate cuts is shared by the broader committee.“We believe the risks are slightly tilted towards dovishness, which could trigger a negative reaction in the US dollar,” ING said.The dollar index has held relatively steady following recent volatility, but analysts suggest that any confirmation of a more accommodative Fed stance could push the greenback lower against major currencies in the coming weeks.