USD AI Market Pulse, Tuesday, 10 November 2026
JAFX AI’s read of the news on USD (US dollar), as it stood at the end of the day: read at 23:55 UTC.
Bias: bullish
USD bid after hot Oct CPI (0.4% m/m, core 0.3%) and Waller's 50bp hint. A Dec hike is ~99% priced, so the next leg needs 50bp to gain traction. Fri PPI is the test.
Oct CPI ran hot: headline 0.4% m/m vs 0.3% f/c and core 0.3% vs 0.2%. That came after Waller warned of aggressive tightening and flagged a possible 50bp December hike. EUR/USD slipped below 1.1200 (around 1.1190). GBP/USD erased Monday's gain to just above 1.3300 and steadied near 1.3350. USD/CHF rose 0.74%, reclaiming the 50-day SMA at 0.8227 and eyeing 0.8250/0.8300. DXY had already turned positive near 101.80 ahead of the data.
The past week
Friday's stronger NFP lifted USD, but those gains were fully given back Monday as Brent slid toward $90 and Treasury yields fell. DXY reversed about 0.6% to the low end of its four-week range. Equities dropped 4.4% after the midterms, then recovered about 3%, with TD noting muted USD haven demand. Hawkish Fed speakers (Barkin, Goolsbee, then Waller) set up CPI, which beat and revived the dollar.
The bigger picture
The regime is a hiking Fed (3.75-4.00% range; September dots show one more hike, then a hold through 2027) against a hawkish ECB (Lane backs a December hike) and French political risk capping EUR. ING sees USD supported into early 2027, then softening from spring as inflation falls. Futures price fewer 2027 moves.
Positioning
A December hike is effectively fully priced (~99%), so incremental USD upside depends on the market moving toward a 50bp move or more 2027 tightening. Softer oil and yields mean a cool PPI or dovish Fed talk could unwind the CPI pop faster than a hot print extends it.
Scenarios it set out
- Fri PPI hot: core PPI y/y > 5% and/or PPI m/m > 0.4% (f/c 0.4%), especially after firm claims below the 195K f/c Thu 50bp-December pricing builds and USD extends. EUR/USD stays heavy below 1.1200, GBP/USD retests 1.3300, and USD/CHF pushes toward 0.8300 then 0.8382.
- PPI in line (core ~5%, m/m ~0.4%) Confirms the 25bp hike already priced and leaves USD range-bound near post-CPI levels. Direction passes to Fed speakers (Williams Thu late, Daly, Goolsbee) on the 50bp question.
- PPI soft: core < 5% or m/m ≤ 0.2%, with dovish-leaning Fed talk 50bp bets fade and USD gives back part of the CPI move as yields and oil weigh. EUR/USD reclaims 1.1220, and GBP/USD heads back toward 1.34 and 1.3420-1.3450.
What it said to watch
- Fed rhetoric on a 50bp December hike: Hammack, Barr, Goolsbee, Daly and Williams on Thu
- EUR/USD around 1.1200 and whether it holds below after CPI
- USD/CHF daily close vs 0.8250 (opens 0.8300); support at the 0.8227 50-day SMA
- GBP/USD 1.3300 floor; UK Q3 GDP Thu (f/c 0.7%) for cross-currents
- DXY vs 101.80 and the low end of its four-week range
- Brent near $90 and Treasury yields: further declines erode USD support
Risk ahead, as it saw it
Thu Nov 12, 13:30 UTC: Initial Jobless Claims (f/c 195K), plus Fed's Hammack, Barr, Goolsbee, Daly and Williams. Fri Nov 13, 13:30 UTC: PPI m/m (f/c 0.4%) and core PPI y/y (f/c 5%, high impact).