Dollar off 8 month low as data mutes US government shutdown

October 2, 2013

NEW YORK (Oct 2)  The dollar traded broadly lower on Tuesday, but came off its deepest lows of the day after robust U.S. manufacturing data offset fears that the U.S. government's first partial shutdown in 17 years would clip the economic recovery.

U.S. manufacturing activity expanded at its fastest pace in almost 2-1/2 years, while firms added the most workers in 15 months.

The government's shutdown at midnight after U.S. lawmakers failed to reach a deal on the budget caused a furlough of 1 million federal employees.

"This is having a muted impact on the dollar, but it all comes down to how long this will last," said Marc Chandler, global head of currency strategy, at Brown Brothers Harriman, New York. "The bottom line is that this has frequently happened in the past 30 years and it is not a crisis. It does not look pretty, but this is how a democracy works."

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