The US Dollar Index (DXY) edges higher around 99.65 during Monday’s early European session, supported by renewed optimism that the prolonged US government shutdown may soon be resolved. Senate Majority Leader John Thune confirmed that bipartisan talks have made significant progress, with lawmakers preparing to vote on a measure that would fund key departments through January 30.

The positive momentum in the Greenback comes despite weak economic data that continue to cloud the broader outlook. The University of Michigan’s Consumer Sentiment Index dropped to 50.3 in November — its lowest level since mid-2022 — reflecting rising consumer anxiety about the economy.

Markets are increasingly betting that the Federal Reserve could deliver a 25-basis-point rate cut in December, with the CME FedWatch Tool showing odds near 67%. Still, easing political uncertainty in Washington is lending near-term support to the Dollar, keeping DXY anchored above the 99.50 zone.