Forex Today: Markets cling to a cautious stance ahead of US producer inflation data

On Friday, November 13, the US Dollar (USD) index was in a consolidation phase above 103.00 after a three-day rally to its highest level since April 2025. The European economic calendar featured September Trade Balance data and a revision to the third-quarter GDP growth. Later, the US Bureau of Labor Statistics (BLS) would release Producer Price Index (PPI) data for October. The USD was the strongest against the Swiss Franc this week.

The heat map showed percentage changes of major currencies against each other, with the US Dollar as the base currency. The US Dollar's strength was attributed to risk-aversion and hawkish comments from Federal Reserve officials, which supported the currency. US President Donald Trump expressed no need for a deal with Iran, causing oil prices to rise. Wall Street's main indexes remained under modest bearish pressure following Nvidia's CEO resignation.

New York Fed President John Williams delivered a more hawkish speech, with a 7/10 FXS Speechtracker score. San Francisco Fed President Mary Daly highlighted potential upside inflation risks due to technology-driven momentum and sticky services prices. The Fed's stance prioritized bringing inflation down despite acknowledging possible future disinflationary forces.

Strategists emphasized that the Dollar remained supported by persistent inflation and the prospect of further Fed tightening. A deteriorating global risk appetite could provide further support through safe-haven demand. Gold lost more than 2.5% and touched its weakest level since October 2025. EUR/USD rebounded but remained on track for weekly losses, while GBP/USD moved sideways.

USD/JPY reached its highest level since early September but corrected into the European session. Japanese Prime Minister Sanae Takaichi stated the government was in close contact with US financial authorities regarding currency markets.