USD strengthens as Trump-Senate deal averts government shutdown

The US dollar gained 0.2% across major pairs following reports of a government shutdown-avoidance agreement between President Trump and Senate Democrats. The deal includes fast-tracking five full-year appropriations bills and providing a two-week continuing resolution for the Department of Homeland Security, extending negotiations on immigration enforcement policies. Markets responded positively to the reduced political uncertainty, with USD/JPY advancing to 109.85 and EUR/USD dipping to 1.0830. The agreement emerged after Democratic opposition to a DHS bill following the Minneapolis incident involving federal immigration agents. Despite the breakthrough, timing risks persist as House members may need to return for voting, potentially causing a brief funding lapse. Traders are monitoring the situation closely, with immediate USD support seen at the 103.50 level on the DXY index, while resistance stands at 104.20.