Reuters reported that October’s hotter-than-expected U.S. inflation strengthened the dollar against the euro and raised market odds of a half-percentage-point Federal Reserve increase in December.
The U.S. Bureau of Labor Statistics (BLS) said the Consumer Price Index for All Urban Consumers rose 0.4% in October from September, after a 0.6% increase the previous month. Core CPI, excluding food and energy, advanced 0.3%, matching its pace in August and September. The headline figure exceeded the 0.3% forecast in a Reuters poll, and the core reading topped the 0.2% consensus Reuters cited.
The BLS said a lapse in appropriations prevented collection of October 2025 survey data, so it could not calculate some October 2026 12-month CPI changes for indexes missing prior-year figures.
Reuters’ Nov. 10 market report put the dollar index at 102.29, up 0.6%, while the euro fell 0.56% to $1.1156. The two-year Treasury yield rose 19.28 basis points to 4.74%, and the 10-year yield advanced 12.76 basis points to 4.988%. Reuters said the two-year move put it on course for its steepest daily rise since tariff-related market turbulence in April 2025.
The European Central Bank’s Nov. 10 reference rate was $1.1214 per euro, determined around 8:10 a.m. ET (2:10 p.m. CET), before the U.S. CPI release.
Reuters reported higher market odds of a half-point increase at the Fed’s Dec. 8-9 meeting. Fed Governor Christopher Waller had said he would consider such a move if October core CPI rose 0.3%, Reuters reported. The expectation was a market view, not a Fed decision.
FXStreet reported Nov. 11 that Societe Generale strategist Kit Juckes estimated EUR/USD fair value near 1.1150 and retained a year-end target of 1.10. Juckes characterized U.S. economic performance as relatively strong.
The BLS has scheduled its October producer price index release for Friday, Nov. 13, at 8:30 a.m. ET. FXStreet said PPI may draw added attention after the CPI report.
