Forex Today: US Dollar Index climbs to fresh 19-month high, Gold drops below $4,000
Here is what you need to know on Thursday, November 12:
The US Dollar Index extends its rally, which was fuelled by hot inflation data and hawkish comments from Federal Reserve (Fed) policymakers, and trades at its highest level since April 2025 above 103.00 on Thursday. In the second half of the day, weekly Initial Jobless Claims and Existing Home Sales data will be featured in the US economic calendar. Investors will also continue to pay close attention to comments from central bank officials.
US Dollar Price This week
The table below shows the percentage change of US Dollar (USD) against listed major currencies this week. US Dollar was the strongest against the Swiss Franc.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.59% | 0.69% | 0.93% | 1.00% | 0.60% | 0.22% | 1.72% | |
| EUR | -0.59% | 0.11% | 0.32% | 0.41% | 0.11% | -0.36% | 1.12% | |
| GBP | -0.69% | -0.11% | 0.21% | 0.29% | 0.00% | -0.48% | 1.01% | |
| JPY | -0.93% | -0.32% | -0.21% | 0.06% | -0.38% | -0.69% | 0.73% | |
| CAD | -1.00% | -0.41% | -0.29% | -0.06% | -0.41% | -0.79% | 0.75% | |
| AUD | -0.60% | -0.11% | -0.00% | 0.38% | 0.41% | -0.47% | 0.92% | |
| NZD | -0.22% | 0.36% | 0.48% | 0.69% | 0.79% | 0.47% | 1.51% | |
| CHF | -1.72% | -1.12% | -1.01% | -0.73% | -0.75% | -0.92% | -1.51% |
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).
The shift in the market-pricing of the Fed rate outlook helps the USD outperform its rivals this week. According to the CME FedWatch Tool, markets are currently pricing in a nearly 62% chance of the Fed raising the policy rate by a total of 50 basis points (bps) in the next two meetings, compared to only 10% probability a week ago. The benchmark 10-year US Treasury bond yield holds steady at around 5% on Thursday after rising for three consecutive days, while US stock index futures stay in negative territory despite Wednesday's bullish action.
Fed hike debate intensifies as MUFG flags risk-reward in favour of 25bps
Analysts at MUFG/BTMU acknowledge that recent market moves have revived speculation over a more forceful policy response from the Fed, but they “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 point out that “we still have another payrolls report (but no further CPI prints, although it’s the day after) before the FOMC meeting,” and caution 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.”
The UK's Office for National Statistics reported earlier in the day that the Gross Domestic Product expanded at an annual rate of 1.9% in the third quarter. This reading followed the 1.4% growth recorded in the previous quarter and matched the market expectation. Other data from the UK showed that Industrial Production and Manufacturing Production rose by 0.3% and 0.7%, respectively, on a monthly basis in September, with both prints coming in better than analysts' estimates. After losing more than 1% in a two-day slide, GBP/USD limits its losses on upbeat UK data but still trades at its lowest level in nearly a month at around 1.3250.
Bank of Japan (BoJ) board member Toichiro Asada said on Thursday that the central bank must be mindful of risk rate hikes that could push down underlying inflation given consumption lacks momentum. USD/JPY holds its ground after rising nearly 0.7% on Wednesday and trades at its highest level since early September near 160.00. Earleir in the day, the data from Japan showed that the Producer Price Index increased by 0.7% on a monthly basis in October, following the 0.2% decline reported in September.
Hawkish Fed repricing continues to weigh heavily on Gold, with the previous metal losing more than 2.5% since the beginning of the week and trading at a new weekly low at around $3,960 in the European session on Thursday.
EUR/USD struggles to shake off the bearish pressure and trades at its weakest level since May 2025 below 1.1100.
AUD/USD declines for the third consecutive day on Thursday and closes in on 0.6800, while NZD/USD trades near 0.5500 after losing about 0.8% on Wednesday.
USD/CAD is up nearly 1% this week and trades above 1.4250 in the European morning.
Fed FAQs
Monetary policy in the US is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability and foster full employment. Its primary tool to achieve these goals is by adjusting interest rates. When prices are rising too quickly and inflation is above the Fed’s 2% target, it raises interest rates, increasing borrowing costs throughout the economy. This results in a stronger US Dollar (USD) as it makes the US a more attractive place for international investors to park their money. When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates to encourage borrowing, which weighs on the Greenback.
The Federal Reserve (Fed) holds eight policy meetings a year, where the Federal Open Market Committee (FOMC) assesses economic conditions and makes monetary policy decisions. The FOMC is attended by twelve Fed officials – the seven members of the Board of Governors, the president of the Federal Reserve Bank of New York, and four of the remaining eleven regional Reserve Bank presidents, who serve one-year terms on a rotating basis.
In extreme situations, the Federal Reserve may resort to a policy named 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 during crises or when inflation is extremely low. It was the Fed’s weapon of choice during the Great Financial Crisis in 2008. It involves the Fed printing more Dollars and using them to buy high grade bonds from financial institutions. QE usually weakens the US Dollar.
Quantitative tightening (QT) is the reverse process of QE, whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it holds maturing, to purchase new bonds. It is usually positive for the value of the US Dollar.
(This story was corrected on November 12 at 07:35 GMT to note in the first sentence that the article referrs to November 12, Thursday, not November 11.)
Author
FXStreet Insights Team
FXStreet
The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.
