Bonds & Stocks
The dollar slipped after a four-day rally took it to the strongest since the beginning of August. A Bloomberg gauge of the currency was set for its best weekly gain since mid-November 2024. Gold extended its losses, while oil held the biggest decline in a week. Global shares were set for a second decline in three weeks as investors took a pause following a robust rebound from April’s lows, when tariff announcements shook markets.
Economy
Air travel, taxpayer services and national parks are among the first government functions to feel the strain of a prolonged impasse, with some agencies implementing a sort of rolling blackout of services to conserve funds and respond only to emergencies. More than a quarter million federal employees missed scheduled paychecks this week, with another 2 million expected to go without by next week, and the Pentagon’s next military payday could prove a political flash point if troops begin missing pay for the first time in decades.Economists estimate that the shutdown could shave 0.1 to 0.2 percentage points off gross domestic product for each week it continues, with the impact magnified because the government’s data flow has largely gone dark.
World
Israel’s cabinet approved a deal that will see Hamas free all remaining hostages held in Gaza in exchange for around 2,000 prisoners. A ceasefire is now in place in most of Gaza and Israeli troops have begun to pull back from their positions, with a 72-hour period for Hamas to release the hostages underway. The deal is based on a plan unveiled by US President Donald Trump and followed days of talks mediated by the Americans, as well as Egypt, Qatar and Turkey.