The U.S. Dollar Index stays under the 98.00 mark, pressured by expectations of Fed rate cuts and concerns over a government shutdown.

The U.S. Dollar Index (DXY), which tracks the greenback against six major currencies, is steady near 97.90 in early European trade on Friday after posting gains in the previous session. Attention now turns to the upcoming U.S. ISM Services PMI and final S&P Global Services PMI reports due later in the day.

The dollar remains under pressure as weakness in the labor market has fueled expectations of additional Federal Reserve rate cuts. According to the CME FedWatch Tool, markets are pricing in a 97% probability of a rate cut in October and a 91% chance of another in December.

Concerns over a prolonged U.S. government shutdown are adding further downside risk. The shutdown is expected to stretch into next week, with Senate Democrats prepared to block a GOP-backed short-term funding measure again, while the Senate is unlikely to convene this weekend. The disruption could delay the release of key U.S. economic data, including September’s Nonfarm Payrolls report.

Meanwhile, President Donald Trump on Thursday suggested issuing rebate checks of $1,000–$2,000 to taxpayers, funded by tariff revenues. Trump estimated collections could eventually total $1 trillion annually, though Treasury Secretary Scott Bessent projected a more conservative figure above $500 billion.