Forex Today: UK hard data and Fedspeak take centre stage

The US Dollar (USD) has reached its highest levels since April 2025. Its advance has gathered pace as markets continue to bet on another interest rate rise at the Federal Reserve’s December meeting.

A sharp recovery in US Treasury yields across the curve has helped lift the US Dollar Index (DXY) to fresh highs, just pips short of the key 103.00 barrier. The data calendar includes weekly Initial Jobless Claims, Existing Home Sales and the EIA’s weekly US crude oil inventory report. The Fed’s Hammack, Barr, Goolsbee and Daly are also expected to deliver remarks.

Driven by the US Dollar’s sharp recovery, EUR/USD has plunged through 1.1100 to levels last seen in May 2025. With no domestic data releases scheduled, attention turns to speeches by the ECB’s Vujčić and Lagarde.

The Greenback’s strength has sent GBP/USD back into the 1.3270-1.3260 range, marking a four-week low. Upcoming UK releases include the RICS House Price Balance, preliminary Q3 GDP Growth Rate, flash quarterly Business Investment data and Balance of Trade figures. Construction Orders/Output, Industrial/Manufacturing Production and the NIESR Monthly GDP Tracker are also on the calendar.

Approaching the key 160.00 barrier, USD/JPY has extended its advance to fresh two-month highs. Japan’s weekly Foreign Bond Investment data will come first, ahead of Producer Prices and remarks from the BoJ’s Asada.

Intensifying selling pressure on risk-sensitive assets has dragged AUD/USD towards 0.6840, a level last seen in January. Australia’s next scheduled events are the Melbourne Institute’s Consumer Inflation Expectations release and a speech by the RBA’s Baker.

Renewed tensions in the Middle East have helped front-month WTI futures (December contract) recover ground. After three consecutive daily declines, the contract has moved back above $87.00 per barrel.

Further US Dollar gains and a broad rebound in US Treasury yields have kept Gold under selling pressure. Extending Tuesday’s retreat, the precious metal has slipped below the key $4,000 level per troy ounce.