The dollar came off an eight-month low and Asian markets edged higher on Wednesday as investors hoped the first partial US government shutdown in 17 years will be short-lived and not snuff out a spreading but still tepid economic recovery.
Because of the shutdown, investors may face a period when they cannot take cues from key US government data, like the monthly jobs report which is due on Friday but might not come out.
The first significant private survey after the shutdown began - the Institute of Supply Management's report on manufacturing - showed the fastest expansion in almost 2-1/2 years, which helped Asia stocks.
Next up to help gauge health of the U.S. economy is the ADP private sector payrolls report, due later on Wednesday.
A drop-off in U.S. economic data at a time when the Federal Reserve has muddied expectations on when will it start reducing its stimulus could hit demand for risky assets.
Echoing those concerns, European stocks are seen opening flat to slightly lower with spreadbetters expecting Britain's FTSE 100 to open 9 to 15 points lower, or as much as 0.2 percent, Germany's DAX to open 3 to 5 points higher, or as much as 0.1 percent, and France's CAC 40 to open 9 to 10 points lower, or as much as 0.2 percent.
In currencies, the euro eased to $1.3523, having hit an 8-month high of $1.3589 in European trade on Tuesday, ahead of a European Central Bank policy meeting later in the day where it is widely expected to stick to its policy course.
Against the yen, the dollar fell back to 97.71 yen after being up as much as 98.09 earlier in the day, reflecting the broader cautious sentiment in the markets.
Despite, the weak tone, the dollar is expected to remain supported from Japanese buyers and foreign players.
The failure of the U.S. Congress to agree on a bill that funds government operations meant up to one million workers were put on unpaid leave, as Democrats and Republicans fight over President Barack Obama's healthcare programme.
For Asian shares, the impact of the ISM manufacturing report was reduced by the government shutdown.