News report 💱 Forex 🌍 EUROPE

EUR/USD Slips Toward 1.1045 as Fed Hike Bets Drive Dollar Rally

EUR/USD languishes near 1.1045 as a hawkish Fed outlook and a 40bp rise in short-dated US yields fuel a broad Dollar rally, overshadowing Eurozone GDP growth.

📅 November 13, 2026 🕐 1 min read

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

📊 Affected Assets (4)

EUR/USD

Bearish 🤖 80%

📅 Short-term 🌍 GLOBAL · Explicit

The pair sits a few pips above 19-month lows at 1.1045, on track for a third straight weekly loss. Mixed Eurozone data (soft Q3 employment change of 0.1% vs 0.2% expected, September trade deficit of EUR 10.3 billion vs EUR 4.5 billion expected) failed to offset Dollar strength driven by a roughly 40bp rise in short-dated US yields since Tuesday on bets of a 50bp Fed hike in December.

Catalysts

▼ October US PPI release due Friday, headline seen at 6.6% Y-o-Y
▼ Market pricing back-to-back Fed hikes in December and January after Waller's 50bp remarks

Risk Factors

▲ Eurozone Q3 GDP accelerated, with quarterly growth reported at 0.6% and yearly growth steady at 1.3%
▲ Trade balance improved from August's EUR 16.6 billion gap to EUR 10.3 billion

USD

Bullish 🤖 80%

📅 Short-term 🌍 US · Explicit

A powerful macro-driven rally in the Dollar is underway, tied to a sharp repricing of Fed policy: short-dated US yields are close to 40bp higher since Tuesday morning after Waller floated a 50bp December hike, and markets see back-to-back December and January hikes as likely. Friday's PPI, expected at 6.6% Y-o-Y headline, could add further fuel.

Catalysts

▲ Fed's Waller mused over a 50bp hike in December
▲ Short-dated US yields close to 40bp higher since Tuesday

Risk Factors

▼ PPI prints below the expected 6.6% headline could soften hike expectations
▼ Market already prices back-to-back hikes, limiting room for further Dollar upside from rate bets

US02Y

Bullish 🤖 75%

📅 Short-term 🌍 US ✨ Inferred

Short-dated US yields are close to 40bp higher since Tuesday morning after Fed's Waller raised the case for a 50bp December hike, and markets now expect back-to-back December and January hikes. Continued repricing of the Fed path would push short-end yields higher still, with Friday's PPI a key test.

Catalysts

▲ Waller's remarks on a possible 50bp December hike
▲ Roughly 40bp rise in short-dated yields since Tuesday

Risk Factors

▼ A softer-than-expected PPI could reverse part of the yield surge

EUR

Bearish 🤖 70%

📅 Short-term 🌍 EUROPE · Explicit

The Euro extends losses on Friday as softer-than-expected Q3 employment growth (0.1% vs 0.2% expected) and a September trade deficit of EUR 10.3 billion, more than twice the EUR 4.5 billion expected, outweighed an acceleration in Q3 GDP.

Catalysts

▼ Q3 Employment Change rose only 0.1% vs 0.2% expected
▼ September trade balance showed a EUR 10.3 billion deficit vs EUR 4.5 billion expected

Risk Factors

▲ Q3 GDP accelerated, reported at 0.6% quarter-on-quarter in the text, with yearly growth steady at 1.3%
▲ Trade deficit narrowed from EUR 16.6 billion in August

🧭 Full analysis of these assets

🎯 Key Takeaways

EUR/USD is trading near 19-month lows of 1.1045, on track for a third straight weekly loss.
Eurozone Q3 employment growth rose 0.1%, missing the 0.2% market expectation.
September trade deficit reached EUR 10.3 billion, more than double the EUR 4.5 billion forecast.
Short-dated US yields have climbed roughly 40bp since Tuesday following Fed official Christopher Waller's 50bp hike remarks.
October US PPI headline inflation is expected to accelerate to 6.6% Y-o-Y.

📝 Executive Summary

The EUR/USD pair is trading near 19-month lows of 1.1045, heading for a third consecutive weekly decline. The Euro remains pressured by mixed regional data, including a Q3 employment rise of only 0.1% and a September trade deficit of EUR 10.3 billion, which significantly missed expectations. Meanwhile, the US Dollar continues to rally as markets price in back-to-back Fed rate hikes following a 40bp surge in short-dated US yields since Tuesday.

❓ FAQ

EUR/USD · Why is EUR/USD falling?

The Dollar is surging as markets now expect a large 50bp Fed rate hike in December and possibly another in January, pushing short-dated US yields sharply higher, while Eurozone data was mixed and could not support the Euro.

EUR/USD · How low can the pair go?

The article only notes the pair is trading a few pips above 19-month lows at 1.1045 and is on track for a third consecutive weekly loss; no further downside targets are given.

USD · What is driving the Dollar higher?

Expectations of a large Fed rate hike at the December meeting, voiced by Fed's Waller, have pushed short-dated US yields about 40bp higher since Tuesday, driving a strong Dollar rally.

US02Y · Why are short-term US yields rising?

Fed officials have opened the door to a 50bp hike at the December meeting, and markets now expect hikes in both December and January, pushing short-dated yields sharply higher.

EUR · Was the Eurozone data bad?

It was mixed: GDP growth accelerated, but employment rose less than expected and the trade deficit was more than twice the market forecast.

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