The US Dollar (USD) has surged to levels not seen since April 2025, driven by growing expectations of another interest rate hike by the Federal Reserve in December. The US Dollar Index (DXY) is nearing the critical 103.00 mark, supported by a sharp rebound in US Treasury yields. Key economic data due this week includes Initial Jobless Claims, Existing Home Sales, and the EIA’s weekly report on US crude oil stockpiles. Additionally, several Federal Reserve officials, including Hammack, Barr, Goolsbee, and Daly, are scheduled to speak.
The Euro (EUR) has weakened significantly, with EUR/USD dropping below 1.1100 for the first time since May 2025. The European Central Bank’s Vujčić and Lagarde are expected to speak, but the domestic calendar is otherwise light. Meanwhile, the British Pound (GBP) has fallen to four-week lows, with GBP/USD testing the 1.3270-1.3260 range. The UK will release a series of economic reports, including the RICS House Price Balance, preliminary Q3 GDP Growth Rate, and flash quarterly Business Investment figures.
The Japanese Yen (JPY) has continued its decline, with USD/JPY approaching the key 160.00 level. Japan’s economic calendar includes Foreign Bond Investment figures, Producer Prices, and a speech by the Bank of Japan’s Asada. The Australian Dollar (AUD) has also weakened, with AUD/USD nearing 0.6840 for the first time since January. Australia will release Consumer Inflation Expectations and a speech by the Reserve Bank of Australia’s Baker.
In commodities, front-month WTI futures have rebounded, reclaiming the $87.00 mark per barrel following renewed tensions in the Middle East. Gold has extended its decline, slipping below the $4,000 mark per troy ounce, as the stronger US Dollar and higher Treasury yields weigh on the precious metal.