Forex News
- The US Dollar Index jumps to near 102.52 as odds of a Fed 50 bps rate hike in December get traction.
- Fed’s Waller said before the US CPI release that higher or steady core figures could propel fears of a 50 bps interest rate increase.
- The US core CPI grew at a faster pace of 0.3% MoM in October vs. 0.2% estimates.
The US Dollar (USD) outperforms its major currency peers on Wednesday, as financial markets have started anticipating a bigger Federal Reserve (Fed) interest rate hike at the December policy meeting.
As of writing, the US Dollar Index (DXY), which gauges the Greenback’s value against six major currencies, trades 0.3% higher to near 102.52. This is the highest level seen in almost four weeks.
US Dollar Price Today
The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Swiss Franc.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.27% | 0.25% | 0.19% | 0.26% | -0.05% | 0.20% | 0.51% | |
| EUR | -0.27% | -0.02% | -0.09% | -0.03% | -0.33% | -0.06% | 0.24% | |
| GBP | -0.25% | 0.02% | -0.06% | 0.00% | -0.31% | -0.06% | 0.26% | |
| JPY | -0.19% | 0.09% | 0.06% | 0.06% | -0.24% | 0.00% | 0.32% | |
| CAD | -0.26% | 0.03% | -0.00% | -0.06% | -0.30% | -0.06% | 0.26% | |
| AUD | 0.05% | 0.33% | 0.31% | 0.24% | 0.30% | 0.26% | 0.56% | |
| NZD | -0.20% | 0.06% | 0.06% | -0.00% | 0.06% | -0.26% | 0.32% | |
| CHF | -0.51% | -0.24% | -0.26% | -0.32% | -0.26% | -0.56% | -0.32% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
What led markets to factor in a jumbo Fed rate hike?
Analysts at MUFG note that the latest market rethink has been “to consider the prospect of a 50bp hike,” stressing that this shift is “only now being considered because of Waller’s comments prior to the CPI report rather than the CPI report itself.” They highlight that “Waller’s comment that a stronger CPI print may warrant a 50bp hike has sparked a debate over whether Waller had knowledge of the CPI print,” helping to push front-end yields higher and reprice Fed expectations.
According to MUFG, “the OIS market is now partially pricing the risk of a 50bp hike on 9th December,” after Waller argued that “the sticky inflation and energy risks warrant the reversal of the 75bps of cuts and hence why wait two meetings to do that.”
Even so, the bank cautions against assuming a larger move is now the base case. “We remain sceptical of the need to hike by 50bps at this stage and suspect the majority will see the better risk-reward in going by 25bps,” they write, pointing out that “we still have another payrolls report (but no further CPI prints, although it’s the day after) before the FOMC meeting.” MUFG adds that “a strong print plus a rebound in crude oil after the recent sharp drop would be one scenario of a possible more aggressive hike,” keeping alive the risk that markets lean further toward a 50bp outcome.
The Consumer Price Index (CPI) data on Tuesday showed that headline inflation grew at a faster pace of 0.4% Month-on-Month (MoM) in October against 0.3% estimates. In the same period, the core CPI – which excludes volatile food and energy items – arrived at 0.3%, higher than expectations of 0.2%.
US Dollar Index Technical Analysis
On the daily chart, US Dollar Index Spot trades at 102.52, holding a bullish bias amid the sustainability above the 20-day Exponential Moving Average (EMA) at 101.91 and the breakout of the Bullish Flag pattern.
The Relative Strength Index (RSI) around 59 keeps a mildly constructive tone rather than signaling overbought conditions.
On the downside, immediate support is located near the 102.50 area, with the EMA 20 at 101.91 reinforcing underlying demand. On the topside, the major clear resistance is the descending trend barrier around 102.94; a daily close above this level would strengthen the bullish case and open room for a more decisive extension of the recent advance.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
US Dollar FAQs
The US Dollar (USD) is the official currency of the United States of America, and the ‘de facto’ currency of a significant number of other countries where it is found in circulation alongside local notes. It is the most heavily traded currency in the world, accounting for over 88% of all global foreign exchange turnover, or an average of $6.6 trillion in transactions per day, according to data from 2022. Following the second world war, the USD took over from the British Pound as the world’s reserve currency. For most of its history, the US Dollar was backed by Gold, until the Bretton Woods Agreement in 1971 when the Gold Standard went away.
The most important single factor impacting on the value of the US Dollar is monetary policy, which is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability (control inflation) and foster full employment. Its primary tool to achieve these two goals is by adjusting interest rates. When prices are rising too quickly and inflation is above the Fed’s 2% target, the Fed will raise rates, which helps the USD value. When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates, which weighs on the Greenback.
In extreme situations, the Federal Reserve can also print more Dollars and enact quantitative easing (QE). QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system. It is a non-standard policy measure used when credit has dried up because banks will not lend to each other (out of the fear of counterparty default). It is a last resort when simply lowering interest rates is unlikely to achieve the necessary result. It was the Fed’s weapon of choice to combat the credit crunch that occurred during the Great Financial Crisis in 2008. It involves the Fed printing more Dollars and using them to buy US government bonds predominantly from financial institutions. QE usually leads to a weaker US Dollar.
Quantitative tightening (QT) is the reverse process whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it holds maturing in new purchases. It is usually positive for the US Dollar.
MUFG’s Derek Halpenny notes that a sharp rise in the 2-year UST yield, driven by stronger US CPI and hawkish comments from Fed Governor Waller, has revived speculation of a 50bp FOMC hike. He remains sceptical this is necessary, favouring 25bp, but warns that stronger data and higher Oil could shift expectations further in favour of the Dollar and pressure EUR/USD below 1.1000.
Hawkish Fed repricing supports Dollar
"On this occasion the market rethink is to consider the prospect of a 50bp hike. This is only now being considered because of Waller’s comments prior to the CPI report rather than the CPI report itself. Waller’s comment that a stronger CPI print may warrant a 50bp hike has sparked a debate over whether Waller had knowledge of the CPI print."
"The OIS market is now partially pricing the risk of a 50bp hike on 9th December."
"We remain sceptical of the need to hike by 50bps at this stage and suspect the majority will see the better risk-reward in going by 25bps. We still have another payrolls report (but no further CPI prints, although it’s the day after) before the FOMC meeting and a strong print plus a rebound in crude oil after the recent sharp drop would be one scenario of a possible more aggressive hike."
"It’s still more a risk than a core view but it would alter the current balanced expectations in the markets across key central banks and shift rate hike expectations much more in favour of the dollar that would likely prompt a further lurch lower in EUR/USD and bring levels below the 1.1000-level into play."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
- The Indian Rupee rallies further against the US Dollar due to multiple tailwinds.
- Lower energy prices and the continued inflow of foreign funds into the Indian stock market have strengthened the INR.
- Concerns about the AI investment outlook have improved the appeal of Indian stocks.
The Indian Rupee (INR) continues to outperform the US Dollar (USD) on the back of significant inflow of foreign funds into the Indian stock market and a continued decline in oil prices. As of writing, the USD/INR pair posts a fresh five-month low near 93.70.
FIIs buying remains significant in past trading days
There has been relentless buying in the Indian stock market by Foreign Institutional Investors (FIIs) in the past trading days.
So far in November, FIIs have remained net buyers in full trading days and have poured a cumulative investment worth Rs. 53,172.24 crore.
Currencies from economies, such as India, which are in their developing stage, tend to outperform when they become attractive investment spots for overseas investors.
What has made India an attractive bet for foreign investors?
According to a report from NDTV Profit, India's relative lack of massive, over-hyped Artificial Intelligence (AI) hardware/infrastructure concentration is now viewed as a defensive advantage, offering better earnings visibility and stability.
Global AI infrastructure-related stocks have seen a massive sell-off since the defeat of United States (US) Republicans in midterm elections.
Strategists at ABN Amro said after the outcome of US midterm elections that the “AI investment story acquired a political risk premium” after “disappointing guidance suggested the Democratic midterm victory could bring greater congressional oversight of AI data infrastructure investment,” undermining sentiment toward AI-related assets and broader risk appetite.
Additionally, fears that Jensen Huang's days as Nvidia CEO are numbered following reports of his affair with alleged Chinese spy Alice Huang have heightened concerns regarding the outlook of spending on AI infrastructure across the globe.
On Kalshi, speculators say there’s just a 17% chance Huang is gone by 2027. Those odds rise to 30% by 2028, and 35% by 2029. However, they think there is a 75% probability that Huang will depart by 2031, CNBC reported.
Oil prices continue to decline on US-Iran deal hopes
Oil prices have fallen significantly after remarks from US President Donald Trump pointing to no further military action against Iran.
Analysts at MUFG note that investor optimism has been further buoyed by a softer tone from Washington, after President Trump told CNN it is “highly unlikely” he will need to order fresh military strikes on Iran if talks continue to show progress. MUFG highlights that Trump also stressed the outcome still hinges on the quality of any deal, stating that “it depends on whether or not they sign a very strong agreement,” a nuance the bank sees as crucial for sustaining the recent pullback in geopolitical risk premia.
As of writing, the MCX Crude Oil contract expiring on November 19 is 0.6% down to near Rs. 8,050, closer to its two-month low of Rs. 7,861 posted on Tuesday.
Technical Analysis: USD/INR stays below 20-day EMA
On Wednesday, USD/INR falls to near 93.70, extending a clear bearish bias as spot holds below the 20-day exponential moving average (EMA) at 94.69. The break and sustained trade under this short-term EMA suggest sellers remain in control, while the Relative Strength Index (RSI) near 25 signals oversold conditions that could slow the downside rather than immediately reverse it.
On the topside, the 20-day EMA at 94.69 is the meaningful resistance after the June 25 low at 94.15, and a daily close back above the dynamic brrier would be needed to ease immediate downside pressure and hint at a corrective bounce. Looking down, the pair is likely to find suppourt near 93.00.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Indian Rupee FAQs
The Indian Rupee (INR) is one of the most sensitive currencies to external factors. The price of Crude Oil (the country is highly dependent on imported Oil), the value of the US Dollar – most trade is conducted in USD – and the level of foreign investment, are all influential. Direct intervention by the Reserve Bank of India (RBI) in FX markets to keep the exchange rate stable, as well as the level of interest rates set by the RBI, are further major influencing factors on the Rupee.
The Reserve Bank of India (RBI) actively intervenes in forex markets to maintain a stable exchange rate, to help facilitate trade. In addition, the RBI tries to maintain the inflation rate at its 4% target by adjusting interest rates. Higher interest rates usually strengthen the Rupee. This is due to the role of the ‘carry trade’ in which investors borrow in countries with lower interest rates so as to place their money in countries’ offering relatively higher interest rates and profit from the difference.
Macroeconomic factors that influence the value of the Rupee include inflation, interest rates, the economic growth rate (GDP), the balance of trade, and inflows from foreign investment. A higher growth rate can lead to more overseas investment, pushing up demand for the Rupee. A less negative balance of trade will eventually lead to a stronger Rupee. Higher interest rates, especially real rates (interest rates less inflation) are also positive for the Rupee. A risk-on environment can lead to greater inflows of Foreign Direct and Indirect Investment (FDI and FII), which also benefit the Rupee.
Higher inflation, particularly, if it is comparatively higher than India’s peers, is generally negative for the currency as it reflects devaluation through oversupply. Inflation also increases the cost of exports, leading to more Rupees being sold to purchase foreign imports, which is Rupee-negative. At the same time, higher inflation usually leads to the Reserve Bank of India (RBI) raising interest rates and this can be positive for the Rupee, due to increased demand from international investors. The opposite effect is true of lower inflation.
Deutsche Bank strategists explain that an upside surprise in US core and headline CPI, combined with hawkish comments from Fed officials, triggered a sharp selloff in US Treasuries. Two-year yields saw their biggest daily jump since 2025, while 10-year yields approached 5%. Market pricing now reflects a more extended and aggressive Fed hiking cycle into 2027.
Hawkish repricing across curve
"That US CPI print drove the biggest moves of the day, with the monthly core CPI print for October above consensus at +0.30% (vs. +0.2% expected)."
"Moreover, it was the third consecutive month with core CPI at +0.3%, and if you take those three months together, the annualised pace for core CPI is running at +3.75%."
"That’s the fastest pace on that measure since April 2024, so it made it increasingly difficult to dismiss this as a blip."
"Meanwhile, the headline CPI numbers were faster still, with monthly headline CPI at +0.35% (vs. +0.3% expected), with the 3-month annualised pace at +5.72%."
"For markets, the clearest impact could be seen in US Treasuries, with yields surging across the curve."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
- Gold bulls struggle to extend gains beyond $4.050 following a sharp reversal from the $4,150 area on Tuesday.
- The US Dollar surges as hot US inflation figures boost hopes of further Fed tightening. and sent the US Dollar surging.
- The XAU/USD's bearish engulfing candle on the daily chart suggests that bears are taking control.
Gold (XAU/USD) is showing a shallow recovery attempt on Wednesday, with bulls struggling to consolidate above $4.050 during the European session, leaving bears in control after the impulsive reversal from the $4,150 resistance area on Tuesday. Precious metals remain vulnerable on Wednesday, as the US Dollar (USD) rallies across the board, boosted by rising hopes of a Federal Reserve (Fed) interest rate hike in December and with Oil prices picking up from lows.
Data from the US released on Tuesday revealed that consumer inflation grew beyond expectations in October, bolstering the case for another Fed tightening move in December and providing a fresh boost to a hitherto soft US Dollar.
Comments from the US central bank have endorsed that view earlier on Wednesday. The President of the Philadelphia Fed, Anna Paulson, called for a “further gradual tightening” to bring inflation to target, and somewhat later, Dallas Fed President Lorie Logan said that “it is clear that the Fed needs at least two more quarter-percentage-point increases,” fuelling the US Dollar further and weighing on precious metals.
Technical Analysis: Potential Double Top formation at the $4,150 area
XAU/USD trades at $4,050, still holding a near-term constructive bias from late October lows, although the bearish engulfing candle in the daily chart and a potential Double Top (DT) formation around $4,150 suggest that buyers are giving up. The Relative Strength Index on the 4-hour chart remains capped below the key 50 level, and the Moving Average Convergence Divergence (MACD) indicator holds in negative territory at -9.51, supporting the bearish view.
Immediate support lies between the November 6 and 10 lows at $4,030 and $4,023, respectively. A clear break below here would confirm the mentioned DT, adding pressure towards the November 2 and 3 highs, around $3,970. The DT's measured target lies around the November 3 low of $3,911.
On the upside, the intra-day high at $4,066 is closing the path towards a key resistance at the mentioned $4,150 area (November 5 and 9 highs.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Gold FAQs
Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.
Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.
Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.
The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.
- Gold steadies but struggles to build momentum as expectations of more Fed rate hikes weigh on sentiment.
- Markets fully price in a December Fed rate hike, with a larger 50 bps move also on the table.
- XAU/USD struggles below its 21-day SMA, keeping the near-term technical outlook tilted to the downside.
Gold (XAU/USD) holds firm on Wednesday after falling 2.67% the previous day, in the aftermath of hotter-than-expected US consumer inflation data and hawkish remarks from Federal Reserve (Fed) officials that fueled expectations of a more aggressive interest rate-hike path. At the time of writing, XAU/USD trades around $4,050, up 0.47% on the day.
The US Consumer Price Index (CPI) rose 0.4% MoM in October, above the 0.3% forecast but down from 0.6% in September. Core CPI, which excludes food and energy, rose 0.3%, matching September’s pace and beating the 0.2% forecast.
Economists at Commerzbank caution that “prices are still rising too quickly, even though the increase was somewhat smaller than in September.” They highlight that “core inflation, a key gauge of the underlying trend, thus remains (too) high and is no longer trending downward,”. In their assessment, “the strong economy and the ongoing conflict in the Middle East suggest that inflation is unlikely to ease in the near term.”
Hawkish Fed signals boost expectations of a 50 bps hike
Before the CPI release, Fed Governor Christopher Waller said a half-point rate hike may be needed in December if October core CPI comes in “around 0.3% or higher.” With inflation meeting that threshold, traders have started pricing in the possibility of a larger move at the December meeting.
Other Fed officials, including Dallas Fed President Lorie Logan and Philadelphia Fed President Anna Paulson, also backed further monetary tightening, while Fed Vice Chair for Supervision Michelle Bowman stressed the need to bring inflation under control.
Markets now fully price in a rate hike in December, with an 88.5% chance of a 25-basis-point (bps) increase and an 11.5% chance of a 50 bps move, according to the CME FedWatch Tool. Traders also expect more rate hikes next year, with three additional quarter-point increases priced in by mid-2027.
US Dollar and Treasury yields rise as traders price in more rate hikes
The shift in rate expectations boosted demand for the US Dollar (USD) and triggered a sharp sell-off in US government bonds, particularly at the short end of the yield curve. The policy-sensitive 2-year Treasury yield jumped around 19 bps on Tuesday, while the benchmark 10-year yield climbed roughly 14 bps during the day, briefly moving back above 5%.
The US bond market is closed on Wednesday in observance of Veterans Day. Meanwhile, the Greenback extends its gains, with the US Dollar Index (DXY) trading around 102.50, approaching the year-to-date high of 102.94 reached in October.
The combination of a stronger US Dollar, elevated Treasury yields and growing expectations of further Fed tightening is likely to keep Gold under pressure. However, robust central bank buying and sustained inflows into Gold-backed exchange-traded funds (ETFs) could continue to provide a structural floor over the longer term.
Technical Analysis: Bears retain control below key daily SMAs
On the daily chart, XAU/USD maintains a bearish bias as it trades below the 21-day Simple Moving Average (SMA) at $4,058, as well as the 50-day and 100-day SMAs. The Relative Strength Index (RSI) hovers around 47, indicating neutral momentum, while the Moving Average Convergence Divergence (MACD) remains in positive territory, although fading green histogram bars suggest weakening bullish momentum.
On the topside, immediate resistance is at the 21-day SMA near $4,058, with further barriers at the 50-day SMA at $4,178 and the 100-day SMA at $4,201, where sellers are likely to defend the recent range highs. On the downside, the psychological $4,000 level acts as immediate support, followed by the yearly low of $3,870.23. A decisive break below the latter could expose Gold to further selling pressure.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Gold FAQs
Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.
Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.
Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.
The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.
- EUR/USD declines to near 1.1138 as the US Dollar outperforms its peers.
- Traders raise hawkish Fed bets as the US core CPI continues to remain elevated.
- ECB’s Klass Knot to replace Preside Christine Lagarde.
The Euro (EUR) is down 0.2% to near 1.1138 against the US Dollar (USD) during the European trading session on Wednesday. The EUR/USD pair is under pressure as the US Dollar (USD) strengthens due to fears that the Federal Reserve (Fed) could follow an aggressive monetary tightening cycle to contain consistently accelerating inflationary pressures.
US Dollar Price Today
The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Swiss Franc.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.22% | 0.21% | 0.16% | 0.23% | -0.03% | 0.24% | 0.47% | |
| EUR | -0.22% | -0.01% | -0.05% | 0.01% | -0.26% | 0.02% | 0.24% | |
| GBP | -0.21% | 0.01% | -0.04% | 0.02% | -0.24% | 0.04% | 0.26% | |
| JPY | -0.16% | 0.05% | 0.04% | 0.07% | -0.19% | 0.07% | 0.30% | |
| CAD | -0.23% | -0.01% | -0.02% | -0.07% | -0.26% | 0.00% | 0.23% | |
| AUD | 0.03% | 0.26% | 0.24% | 0.19% | 0.26% | 0.28% | 0.50% | |
| NZD | -0.24% | -0.02% | -0.04% | -0.07% | -0.01% | -0.28% | 0.23% | |
| CHF | -0.47% | -0.24% | -0.26% | -0.30% | -0.23% | -0.50% | -0.23% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
In the European trade, the US Dollar Index (DXY), which gauges the Greenback’s value against six major currencies, posts a fresh almost four-week high at 102.51.
According to the CME FedWatch tool, financial markets have started pricing in a 50 basis points (bps) interest rate hike in December, following the release of the hotter-than-projected United States (US) Consumer Price Index (CPI) data for October. However, the odds are nominal at around 13.5%.
Strategists at Deutsche Bank said in a note that the “monthly core CPI print for October was above consensus at +0.30% (vs. +0.2% expected).” Deutsche Bank added that “it was the third consecutive month with core CPI at +0.3%, and if you take those three months together, the annualised pace for core CPI is running at +3.75%.” According to the bank, “that’s the fastest pace on that measure since April 2024, so it made it increasingly difficult to dismiss this as a blip.”
The bank also underscores that “meanwhile, the headline CPI numbers were faster still, with monthly headline CPI at +0.35% (vs. +0.3% expected), with the 3-month annualised pace at +5.72%.”
Meanwhile, the regime change at the European Central Bank (ECB) is expected to keep the Euro highly volatile.
ECB succession focus as Klaas Knot signals readiness to act in future crises
Rabobank highlights that Dutch central banker Klaas Knot, a leading candidate to succeed ECB President Christine Lagarde, used a Financial Times interview to underscore the Governing Council’s crisis-fighting credentials, stressing that “If circumstances require it, we will not hesitate to take action.” Analysts note that Knot’s remarks were not about revisiting “50bps rate hikes due to geopolitically driven inflation,” but rather about the opposite scenario, in which Europe faces a future crisis “of a different nature.” In that context, Rabobank points out that Knot “would not rule out developing another, more tailored instrument,” raising the prospect of fresh policy tools should conditions deteriorate again.
EUR/USD Technical Analysis
In the daily chart, EUR/USD trades at 1.1138, extending a soft bearish tone as price holds beneath recent closes while remaining just under the 20-day exponential moving average (EMA) at 1.1200, which now acts as nearby hurdle.
The 14-day Relative Strength Index (RSI) sits around 41, below the neutral 50 line, hinting that downside pressure still prevails even as oversold conditions seen earlier in the month have eased.
On the downside, the recent low of 1.1104 is the immediate support; a break below that level would expose the pair to 1.1000. On the upside, a recovery back toward the 20-day EMA support zone near 1.1200 would be the first sign of stabilization, and sustained trading above that level would be needed to ease the current bearish bias and open the door to a broader corrective bounce.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Economic Indicator
Consumer Price Index ex Food & Energy (MoM)
Inflationary or deflationary tendencies are measured by periodically summing the prices of a basket of representative goods and services and presenting the data as the Consumer Price Index (CPI). CPI data is compiled on a monthly basis and released by the US Department of Labor Statistics. The MoM print compares the prices of goods in the reference month to the previous month.The CPI Ex Food & Energy excludes the so-called more volatile food and energy components to give a more accurate measurement of price pressures. Generally speaking, a high reading is seen as bullish for the US Dollar (USD), while a low reading is seen as bearish.
Read more.Last release: Tue Nov 10, 2026 13:30
Frequency: Monthly
Actual: 0.3%
Consensus: 0.2%
Previous: 0.3%
Source: US Bureau of Labor Statistics
The US Federal Reserve has a dual mandate of maintaining price stability and maximum employment. According to such mandate, inflation should be at around 2% YoY and has become the weakest pillar of the central bank’s directive ever since the world suffered a pandemic, which extends to these days. Price pressures keep rising amid supply-chain issues and bottlenecks, with the Consumer Price Index (CPI) hanging at multi-decade highs. The Fed has already taken measures to tame inflation and is expected to maintain an aggressive stance in the foreseeable future.
Kit Juckes at Societe Generale highlights that rising global bond yields are pressuring leveraged housing markets such as Australia. Recent NAB business confidence and home loans data were notably weak. While AUD rates are still preferred over USD rates, he judges that AUD/USD has room to fall given the Australian Dollar’s strong performance earlier in the year.
Rates trade favoured over currency
"The rise in bond yields, however, is feeding through to leveraged housing markets, and Australia is certainly one of them."
"Yesterday’s NAB business confidence indicator took a sharp turn lower, and this morning’s home loans data were at least as disappointing."
"In the current market, I suspect that may still be a better trade than shorting AUD/USD, although the latter has room to fall given how well the Australian dollar has performed overall this year."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
ING’s Chris Turner reports improving Japanese manufacturing sentiment, supported by semiconductor and data centre demand, strong corporate profits and firm wages. This backdrop could reinforce Bank of Japan (BoJ) confidence that inflation is stable near 2%.
Stronger Japan data versus Dollar momentum
"All of the above can feed into the Bank of Japan's view that inflation is now stable at 2.00% and its accommodative monetary policy can be reined in."
"The broadly strong dollar means that USD/JPY could easily push through resistance at 159, but we increasingly think investors will be looking to acquire cheap yen should USD/JPY push above 160 again."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
Deutsche Bank analysts report that the strong US CPI data and hawkish Fed commentary sparked a selloff in US Treasuries and pressured US equities. The S&P 500 slipped as investors priced faster hikes, with Tech and AI-linked names underperforming initially. However, a revenue beat and upgraded guidance from CoreWeave later supported futures, pointing to some recovery in the S&P 500.
Rates shock hits US stocks
"In fact, the 2yr Treasury yield (+17.6bps) saw its biggest daily jump since April 2025, surging to 4.74%, and markets even priced a modest chance of a 50bp Fed hike in December."
"So it was a very rough day for rates, and that in turn put renewed pressure on equities, with the S&P 500 (-0.38%) pulling back as investors priced in faster hikes."
"With markets pricing in a more hawkish Fed, that also drove a fresh selloff in US equities, though this did ease a bit as the session went on."
"Tech stocks underperformed, with a -5.47% drop in Nvidia leading the Nasdaq (-0.74%) and the Mag-7 (-0.83%) to larger declines than the S&P 500 (-0.38%)."
"After the close, we then heard from CoreWeave, which delivered a Q3 revenue beat ($3.66bn vs $3.56bn est.) and upgraded its full-year revenue guidance ($13.0-13.3bn vs $12.9bn est.)."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
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