Dollar Index Hits Highest Since April 2025 as Yen Nears 160 and Euro Falls to Lowest Since May 2025

The U.S. dollar rose against major currencies on Wednesday, Nov. 11, 2026, pushing the yen close to 160 per dollar and the euro to its lowest level since May 2025. Traders added to bets that the Federal Reserve will raise interest rates next month. With U.S. bond markets closed for Veterans Day, analysts said liquidity could be thin.

Dollar index at highest since April 2025

The dollar index, which measures the greenback against six major currencies, was up 0.63% at 102.85 after hitting its highest level since April 2025, Reuters reported in a New York-datelined story late Wednesday morning. HSBC data showed the index at 102.20 on Tuesday, according to Investing.com.

Traders raised the probability of a quarter-point Fed rate increase in December to 87%, up from about 70% a month ago, according to CME's FedWatch tool. That followed a third straight month of higher-than-expected consumer price data. "We've got broad-based strength in the dollar largely underpinned by a hawkish shift in Fed fund rates expectations driven by the hot October CPI print but amplified as well by recent comments by Fed officials," said Elias Haddad, global head of markets strategy at Brown Brothers Harriman.

Some brokerages changed their Fed forecasts after Tuesday's data. Goldman Sachs now expects rate increases in December and March, and Deutsche Bank expects increases in December, January and March, Reuters reported.

Yen nears 160

The dollar rose 0.69% to 159.83 yen, its strongest level in more than two months. In Tokyo, the Bank of Japan's daily market data showed the dollar at 158.87-89 yen at 5 p.m. local time, with a central rate of 158.84.

In a note on Wednesday, MUFG Research said USD/JPY was back near the 160 level, "above which intervention becomes a much greater prospect." MUFG said Tuesday's move in the U.S. two-year Treasury yield was the biggest jump since April 2025. It also pointed to Japanese Finance Ministry data showing that November issuance of government bonds to individual investors totaled 2.026 trillion yen, the largest monthly total on record.

Standard Chartered said in its daily note that dollar strength had outweighed hawkish signals from the Bank of Japan. It cited the BoJ's October Summary of Opinions, in which several board members favored further tightening.

Euro, pound and franc weaken

The euro fell 0.61% to $1.11, extending Tuesday's losses, Reuters reported. Earlier in the day, ING's global head of markets, Chris Turner, said the dollar index could retest "big resistance" at 102.85 to 103.00. "We expect the dollar to stay strong and explore the top end of trading ranges over the coming weeks," he said. He expects EUR/USD to "press the lower end of a 1.10-1.15 range" into year-end. ING expects the European Central Bank to match a Fed increase with a move to 2.75% on Dec. 17.

Standard Chartered noted that ECB Chief Economist Philip Lane said another December rate increase would be prudent if economic conditions remain unchanged.

The British pound fell 0.47% to $1.33, near its lowest in two weeks. Bank of England Deputy Governor Clare Lombardelli voted with the 8-1 majority last week to raise rates to 4% from 3.75%. In a speech on Tuesday, she said "the conditions for persistent inflationary dynamics over the medium term are crystallising," and she described every upcoming meeting as "live," Investing.com reported.

The dollar rose 0.86% to 0.832 Swiss francs after hitting its highest since mid-October. It gained 0.48% to 9.54 Norwegian crowns, while the Australian dollar slipped 0.19% to $0.6852. Reuters noted that most developed-market currencies, except the Australian dollar and the Norwegian crown, have weakened against the dollar this year as interest-rate gaps widened.

What comes next

Market attention now turns to the October producer price index on Friday, Nov. 13, which ING described as the next catalyst. Weekly U.S. jobless claims are due Thursday. The Fed's policy meeting is Dec. 8-9, and MUFG noted that one more payrolls report is due before the decision.