The dollar index printed 103.08 on Thursday, its highest since April 2025. The peak came six days after October payrolls beat forecasts by 100,000 and two days after October CPI ran hot at 0.4% on the month, with core prices up 0.3% for a third straight month. By the European session the index had slipped back to the 102.80s, and Brown Brothers Harriman's Elias Haddad said the rally had outrun the level rate differentials justify. The peak put the index 0.80% above its November 6 close of 102.26; the pullback trimmed it to 0.61%.
The rally had a clear trigger. October CPI forced a hawkish repricing of the Fed path, and Governor Christopher Waller had set the terms before the print: he would back a 25bp rise at the December 8-9 meeting unless core CPI came in at 0.3% or more, per Reuters. Core printed exactly 0.3%.
Goldman Sachs now expects another hike early next year on top of December, per Reuters. The euro fell to 1.1067 in Asian trading, its lowest since May 2025, and the dollar hit 159.945 against the yen, its highest in over two months, per Reuters. Gold slipped to $3,932.90 in MarketRadar's 13:13 UTC snapshot, down 2.43% from the $4,030.80 post-CPI level, while bitcoin traded at $72,417, down 1.28% from $73,356 the same day.
The week that repriced December
Four prints in six days settled December.
| Date | Event | Market read |
|---|---|---|
| Nov 6 | October payrolls 165,000 vs 65,000 expected; jobless rate 4.1% | Dollar index +0.77% to 102.26 |
| Nov 10 | October CPI +0.4% on the month; core +0.3% for a third month | Gold fell 2.67% to $4,030.80; bitcoin fell to $73,356 |
| Nov 11 | 25bp December hike fully priced | 91.9% on 25bp, 9.1% on 50bp (as of November 11) |
| Nov 12 | Dollar index 103.08, highest since April 2025 | Euro 1.1067, lowest since May 2025; dollar-yen 159.945, two-month high |
| Nov 12 | Index eases to the 102.80s | BBH: rally overshot rate differentials |
Every print since November 6 has pushed the same way, and the dollar has answered each one with a new high.
Why the rally hit a wall
Haddad's case rests on two numbers that have not moved with the dollar. The greenback has moved past the level justified by rate differentials, per FXStreet, and US real wages were flat in October, so a bigger hike would land on consumers whose pay is already standing still. Reuters and CME FedWatch put 91.9% on a 25bp December move and 9.1% on 50bp as of November 11; InvestingLive's morning note put the 50bp chance at 12%. FXStreet reported a nearly 62% chance on 50bp of hikes across the December and January meetings combined, up from 10% a week earlier.
Waller's own line was met to the decimal. Core CPI printed 0.3%, the exact level he named as the trigger to consider 50bp, yet the futures market still prices only a small chance of it. The index held 102.29 a day earlier, when the December hike was first fully priced.
What to watch
- Weekly jobless claims due 13:30 UTC (18:30 PKT), forecast 195,000 against 189,000 prior.
- October existing home sales due 15:00 UTC (20:00 PKT), forecasts from 3.85 million to 3.94 million against 3.99 million in September.
- Fed speakers today: Hammack (Cleveland) 09:00 ET, Barr 10:00 ET, Goolsbee (Chicago) 11:30 ET, Daly (San Francisco) 13:10 ET, Schmid (Kansas City) 13:30 ET, Williams (New York) 18:30 ET. Hammack dissented at the October meeting in favor of a 25bp hike.
- October PPI lands Friday, November 13, at 13:30 GMT, the last inflation print before the December 8-9 meeting.
- November CPI is due December 10, one day after the meeting ends.
Key points
- Dollar index hit 103.08 on November 12, its highest since April 2025, then eased to the 102.80s.
- October CPI ran hot at 0.4% on the month; core 0.3% for a third month.
- A 25bp December hike is fully priced: 91.9% on 25bp, 9.1% on 50bp as of November 11.
- BBH says the rally overshot rate differentials and flat real wages cap 50bp pricing.
- Six Fed speakers are due today, with New York's John Williams closing the day at 18:30 ET.
MarketRadar take
The dollar's pause looks like a breather inside a repricing, not a reversal: the hike is fully priced and the debate has moved to 25bp or 50bp. A daily close above 103.08 confirms the breakout; a slide back under 102.26, the November 6 close, says the repricing has stalled. Tonight's words from Williams carry more weight than the claims and home-sales prints.
