US Shutdown Deepens Worst Year for Currency Trading Since 2005
WASHINGTON – The prolonged US government shutdown is worsening an already difficult year for currency traders, bringing about the weakest performance since 2005, according to a BarclayHedge index.
The lack of updated economic data has disrupted forecasting and decision-making across financial markets. For weeks, essential market and economic reports have not been released, leaving traders uncertain about the direction of the US dollar.
“Crucial data have not been published in weeks, making traders less willing to stake big bets on where the US dollar is headed.”
Before the shutdown began, institutions such as Goldman Sachs Group, Morgan Stanley, and Bank of New York Mellon were already reporting lower currency trading revenues. The situation has only worsened with the ongoing data blackout.
Quantitative funds now lack quality datasets necessary for algorithmic trading, and strategists have postponed updates to their forecasts. Consequently, volatility in the foreign exchange market has dropped far below historical norms — a stark contrast to the sharp movements that followed President Donald Trump’s tariff policy announcement in April.
Key Impacts
- Currency traders face their poorest yearly results since 2005.
- Official data interruptions have intensified market uncertainty.
- Major banks report declining foreign-exchange revenues.
- Reduced volatility contrasts with previous market turbulence earlier in the year.
Author’s Summary: The record US government shutdown has deepened trader uncertainty by halting key data releases, leading to the weakest currency trading performance in twenty years.
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