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Dollar hits 19-month high as Fed hike bets grow, euro slips to 18-month low

Dollar index climbs to a 19-month peak and euro hits an 18-month low as traders price a possible Fed rate hike in December, per Market Talk.

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what happened

The dollar index rose to 103.083 overnight, its highest level since April 2025, Market Talk reports. KBC Bank analysts believe the dollar's rally could have further to run. Support comes from growing expectations of a Fed rate increase in December, after U.S. inflation came in above forecasts and Governor Christopher Waller backed a more aggressive tightening path.

The euro dropped to an 18-month low of $1.1065 before trading near $1.109. ING's Francesco Pesole sees a risk of a move below $1.10 in coming days, but a decisive break would likely require markets to take a 50 basis point Fed hike seriously, which he calls a stretch for now. LSEG data show markets price about a 9% chance of a 50bp hike and 90% for a 25bp move.

In Asia, the rupiah hit a record low after Indonesian Vice President Gibran Rakabuming Raka resigned, CIMB analysts say.

why it matters

A strong dollar and expectations of tighter Fed policy weigh on the euro and emerging-market currencies. Sterling and gilts are also reacting to Bank of England rate-hike bets after the UK GDP beat forecasts.

market impact

Dollar and currencies: Fed hike bets support the dollar and pressure the euro and rupiah

  • US dollar (DXY) pressure up — markets are pricing a chance of a December Fed rate hike
  • EUR/USD pressure down — the euro fell to an 18-month low against the dollar
  • Indonesian rupiah pressure down — political uncertainty and a strong dollar weigh on the currency

tags

CryptoEconomyCurrencyGDPMonetary Policy

instruments

DXYEUR/USD ↗GBP/USD ↗USD/IDRUK gilts

on polymarket

Will US Dollar Index (DXY) hit (LOW) 100.00 in November?44%US Dollar Index (DXY) Up or Down on November 12?100%Will US Dollar Index (DXY) hit (HIGH) 105.00 in November?5%

sources

  1. Swiss Franc Could Fall on Prospect of SNB Interventions — Market Talk, 12 November 2026 at 09:51 UTC
  2. Swiss Franc Could Fall on Prospect of SNB Interventions — Market Talk, 12 November 2026 at 09:51 UTC

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