What’s new
Global risk sentiment improved after signs that Washington would restore government funding, easing a 42‑day shutdown drag. Equities in Asia and Europe opened firmer and U.S. futures ticked higher. The move came alongside renewed weakness in the Japanese yen, which hovered near multi‑month lows as traders stayed alert to any fresh warnings from Tokyo about “excessive” FX volatility.

Why it matters for FX
Shutdown relief typically supports risk appetite and narrows demand for the U.S. dollar as a safe haven, but the impact is uneven across pairs. USD/JPY remains sensitive to rate differentials and any hint that the Bank of Japan could tolerate a slower pace of yen strengthening. Verbal intervention risk is elevated; even small phrasing changes from officials have moved the pair in recent weeks.

Market picture

• Equities: The Dow held record territory while the tech‑heavy Nasdaq remained more fragile after chip‑ecosystem headlines earlier in the week.
• FX: The yen slipped toward a nine‑month low; the dollar index softened on weaker labor signals, while high‑beta FX tracked equity futures.
• Rates/Commodities: Treasury yields steadied after recent swings; oil stayed capped by inventory‑build forecasts that point to softer prices into 2026.

What to watch next

• Any formal vote that fully restores U.S. government operations.
• Language from Japan’s MoF/BoJ on disorderly FX moves.
• The timetable for delayed U.S. macro releases and how proxies (nowcasts, private surveys) steer positioning.

Sources

• Reuters market wrap on shutdown relief and yen watch.
• Reuters live markets on tech rotation and Dow highs.
• TradingEconomics: recent DXY slip on soft labor signals.
• EIA STEO: inventories rising, Brent seen averaging ~$62/b in 4Q25 and ~$52/b in 2026.