News report 💱 Forex 🌍 GLOBAL

Euro Hits 18-Month Low at 1.1050 as Dollar Index Climbs to Multi-Year High

EUR/USD slides to 1.1050 as the Dollar Index hits an 18-month peak, driven by aggressive Fed rate-hike expectations and rising geopolitical tensions that pushed Brent crude up over 3%.

📅 November 12, 2026 🕐 1 min read

3 assets impacted (Forex, Commodities). Net bias: 2 Bullish, 1 Bearish, 0 Neutral. Strongest signal: EUR/USD ↓ 6/10 (80% confidence).

📊 Affected Assets (3)

EUR/USD

Bearish 🤖 80%

📅 Short-term 🌍 GLOBAL · Explicit

The Euro hit an 18-month low, falling from about 1.1200 to around 1.1050 with a session low just under it, and Wednesday was the first close below the October lows. Fed rate-hike expectations (Waller's half-point option for December 9) against an ECB deposit rate of 2.50% widen the rate gap by at least 1.25 points, favouring further downside.

Catalysts

▼ Waller on November 10 saying a half-point Fed hike should be an option for December 9
▼ US inflation beat forecasts the same day

Risk Factors

▲ Friday's US producer prices (forecast 0.4% monthly, 6.6% yearly) could come in softer and ease Fed pricing
▲ Eurozone Q3 growth (10:00 GMT Friday) beating the 0.4% forecast could lift the Euro

USD

Bullish 🤖 80%

📅 Short-term 🌍 US · Explicit

The Dollar Index reached an 18-month high, with most of its climb since August attributed to the Euro falling. Fed funds futures price a quarter-point hike on December 9 with about nine chances in ten, and the 3.75%-4.00% Fed rate versus the ECB's 2.50% keeps the dollar's yield advantage widening.

Catalysts

▲ Dollar Index at an 18-month high
▲ Futures give ~90% odds of a quarter-point Fed hike on December 9

Risk Factors

▼ Friday's producer prices forecast at 0.4% monthly versus 1.3% prior imply a slowdown that could soften Fed expectations
▼ Retail sales on November 17 are forecast flat after 0.8%, which could trim December hike odds

UKOIL

Bullish 🤖 70%

📅 Short-term 🌍 GLOBAL · Explicit

Brent rose more than 3% on Thursday after Iranian state media reported an attack on Sirik in southern Iran. A supply-risk premium in the market supports higher Brent prices, and the Eurozone's near-total import dependence on dollar-priced crude amplifies the macro read-through.

Catalysts

▲ Iranian state media report of an attack on Sirik in southern Iran
▲ Brent up more than 3% on Thursday

Risk Factors

▼ If the attack proves isolated with no disruption to exports, the risk premium could fade quickly

🧭 Full analysis of these assets

🎯 Key Takeaways

EUR/USD dropped to 1.1050, marking an 18-month low and the first close below October support levels.
The Fed's 3.75%-4.00% rate range creates a gap of at least 1.25 percentage points over the ECB's 2.50% deposit rate.
Brent crude rose more than 3% on Thursday following reports of an attack on Sirik, Iran.
US jobless claims were 200K for the week, slightly above the 195K forecast, but did not alter Fed rate-hike pricing.
Eurozone Q3 growth data is scheduled for release on Friday at 10:00 GMT, with forecasts holding at 0.4%.

📝 Executive Summary

The Euro has fallen to an 18-month low of 1.1050, pressured by a widening interest rate gap between the ECB's 2.50% deposit rate and the Fed's 3.75%-4.00% range. Meanwhile, the Dollar Index reached an 18-month high, bolstered by market expectations for a December Fed rate hike and a 3% surge in Brent crude prices following reports of an attack in southern Iran.

❓ FAQ

EUR/USD · How far has EUR/USD fallen and why?

It is around 1.1050, down from near 1.1200 at Monday's close and roughly 5.5% below the late-August peak just above 1.1700, driven by rising Fed rate-hike expectations and an 18-month-high Dollar Index.

EUR/USD · What data could change the direction?

US producer prices on Friday (forecast 0.4% monthly) and retail sales on November 17 feed the size of the Fed's December move, while Eurozone Q3 growth and October final inflation (November 18) affect ECB expectations.

USD · Why is the dollar strong right now?

Futures price roughly nine chances in ten of a quarter-point Fed hike on December 9, and the Fed's 3.75%-4.00% rate stands at least 1.25 percentage points above the ECB's 2.50% deposit rate, plus a 3% Brent jump on the Iran attack supported the dollar against the Euro.

USD · What could weaken the dollar?

Softer-than-forecast US producer prices on Friday or flat retail sales on November 17 would reduce the size of the expected December Fed move.

UKOIL · Why did oil jump?

Brent rose more than 3% after Iranian state media reported an attack on Sirik in southern Iran, raising supply concerns.

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