Errante’s The Week Ahead: 10^th – 14^th November 2025 

Highlights of the This Week 

• US inflation retakes center stage: October CPI (Thu) and jobless claims will steer real yields, USD, and risk assets. 

• Europe in focus: German CPI (Wed) sets the tone for Eurozone disinflation; UK Q3 GDP (Thu) reveals growth mix into year-end. 

• Markets & positioning: Indices wobble after a powerful AI-led run; DXY consolidates; gold holds gains as real-rate path stays debated. 

Errante’s The Week Ahead: 10th – 14th November 2025 

US: CPI is the hinge for real rates, risk and the dollar 

The Fed cut a quarter point at the last meeting, but Chair Powell pushed back on a pre-set easing path. Fresh CPI is therefore pivotal. The last full release showed core CPI +0.2% m/m with shelter cooling (smallest OER gain since 2021), validating the glide lower in underlying inflation (Bureau of Labor Statistics). Consensus for October skews to headline +0.3% m/m, core +0.2% (y/y 3.0% headline).  

Our base case: core sticks at +0.2%, led by continued deceleration in shelter, softer core goods (autos/electronics), and slower services-ex-shelter as demand cools. That combination should cap real yields and limit broad USD upside, while allowing US indices to stabilise after recent volatility—provided supply/credit headlines don’t re-ignite a rates spike. 

Complication: the US government shutdown earlier in October delayed several key reports (NFP, CPI scheduling risk was flagged), reducing visibility for policymakers and markets. This uncertainty keeps option premia elevated into CPI and the 10Y/30Y auctions (Wed/Thu), where term-premium dynamics can whipsaw yields. 

Equities: AI momentum vs. tighter financial conditions 

The multi-month rally has been powered by the “Magnificent Seven,” upbeat earnings and record AI/data-center capex, with the Nasdaq 100 logging its longest monthly streak since 2017, even as breadth remained narrow (risk: pullback) . Yet financial conditions face headwinds from heavy corporate bond supply (e.g., large-cap tech issuance) and a Fed that is “patient but not pre-committed,” which pushed back on expectations for another near-term cut . For FX traders, that mix argues for two-way USD around CPI: a soft print helps pro-risk FX and gold; a hot print re-steepens front-end real rates and lifts DXY. 

Credit & debt risks: the “shadow default” watch 

Beyond Treasuries, private credit quality is under scrutiny. The growing use of payment-in-kind (PIK) features – viewed by Lincoln International as a “shadow default rate” – has risen toward ~6% in recent datasets, a sign of earnings stress among some borrowers and a potential drag on capex if funding tightens. Any widening in credit spreads would pressure cyclicals, EM FX and high-beta G10 (AUD/NOK/SEK), while supporting USD and JPY on risk aversion. 

Europe & the euro: German CPI, energy, and growth mix 

Germany’s October CPI (final) is expected around 0.2–0.3% m/m, keeping the Euro-area flash at ~2.2% y/y and reinforcing a disinflation narrative that let the ECB pause its cycle; markets price low odds of further cuts near term as policymakers gauge growth vs. sticky services. Fundamentals shaking the EUR right now: 

• Weak industrial surveys & Germany’s growth stagnation vs. resilient services; 

• Energy curve less supportive than in H1, keeping terms of trade mixed; 

• US-EU rate differentials still wide, leaving EUR sensitive to US CPI and real-rate repricing. 
  Into week-ahead, a soft US core plus benign German CPI would aid EUR on the crosses; the opposite risks a EUR pullback. 

UK: decoding GDP composition ahead of the BoE’s “evolution” 

The UK Q3 GDP release should show modest q/q growth with consumption under pressure from past real-income squeeze, capex uneven, and net trade volatile. Markets still digest the BoE’s communications overhaul (member-by-member rationales) and a near-term hold bias amid easing inflation, but the bar for a surprise cut remains non-trivial only if growth undershoots materially (which would weigh further on GBP) . 

Gold: consolidation with asymmetric dip-support 

Gold surged to record territory in October/early November as investors hedged policy and data uncertainty (shutdown/data blackout, credit jitters) and central-bank demand stayed firm. Into CPI, softer core and stable long-end argue for gold-on-dips, while a hot print and higher reals could trim gains. Structurally, mixed growth and a patient Fed keep the floor relatively well-bid. 

Trading Takeaways (FX desks) 

• Into CPI: Expect two-way USD; fade extremes against well-defined levels (DXY 100.5 resistance / 99.0 support). 

• AI-rally vs. tighter conditions: Respect credit-spread risk; negative headlines can flip USD bid (JPY/CHF out-perform in risk-off). 

• EUR drivers: Watch German CPI for disinflation confirmation; a miss higher would cap EUR rallies via rate-differential channel. 

• GBP sensitivity: UK GDP composition matters—consumption & business investment weakness argues for GBP on rallies to be sold unless BoE rhetoric turns hawkish. 

• Gold: Soft CPI + strong auction demand = dip-buy bias; hot CPI + weak auctions → tactically fade strength. 

Market Events and Announcements (GMT+2) 

Monday, 10^th November 2025 

• No high impact event 

Tuesday, 11^th November 2025 

• No high impact event 

Wednesday, 12^th November 2025 

• 09:00 – EUR – German CPI (MoM, Oct): Final price pulse before Eurozone prints; a soft read keeps ECB sidelined. 

• 20:00 – USD – 10-Year Note Auction: Term-premium/real-rate signal for USD and gold. 

Thursday, 13^th November 2025 

• 09:00 – GBP – GDP (Q3 / YoY / Sep m/m): Growth mix and consumption/capex clues for BoE path. 

• 15:30 – USD – CPI (Oct): Core 0.2% m/m (consensus); shelter & services-ex-shelter in focus. 

• 15:30 – USD – Initial Jobless Claims: Labor cooling confirmation. 

• 19:00 – USD – Crude Oil Inventories: Risk tone & CAD energy linkage. 

• 20:00 – USD – 30-Year Bond Auction: Long-end demand; watch for yield tail that could lift DXY. 

Friday, 14^th November 2025 

• No high impact event 

Market Insights: Key Charts to Watch 

1) US Dollar Index (DXY) – Daily 

Structure & Momentum:  

DXY holds a rising channel from the 3.5-year low, consolidating near 99.6 after failing to sustain above the 3-month high (~100.4–100.5). PPO is positive but flattening with a mild bearish divergence vs. late-October highs; ROC is positive but below prior peaks—both consistent with slowing upside momentum (your chart). Bollinger mid-band rides near ~99.2–99.3; upper band ~100.2–100.3. 

Main Scenario (base case): 

Range-with-upside-bias, conditional on CPI. A core +0.2% and benign headline keep DXY contained below 100.4–100.5 (3-M high/horizontal), with pullbacks toward 99.2 (mid-band) and 99.0 (round figure). 

If auctions clear smoothly and CPI is tame, real yields ease, favouring EUR, gold, beta-FX at the margin. 

Key Levels: 

• Resistance: 100.4–100.5 (3-M high/horizontal), 100.9–101.0 (channel top/psych), 101.4 (next swing). 

• Support: 99.2–99.3 (mid-band), 99.0, 98.56 (band/near prior shelf), 98.03, then 97.50 (channel base). 

Alternative scenario (hot CPI / weak auctions): 

A core ≥0.3% or poor auction tails lifts real yields and DXY through 100.5, opening 100.9–101.0 and 101.4; gold softens and risk wobbles. 

2) EUR/CAD – Daily 

Structure & Momentum: Price 1.630 trades inside a year-long ascending channel. It’s pressing the near-term breakout line at 1.6328 (100% swing) after rebounding from 1.6256 (61.8%). PPO has turned up from negative territory (bullish and improving), MFI ~40 is curling higher, and ROC has flipped positive—an early-cycle momentum resumption. 

Main Scenario (bullish continuation): 

A daily close above 1.6328 completes a minor basing pattern and re-engages the channel topside, targeting 1.6445 (161.8% ext.), then 1.6586 (227.2%) and 1.6706 (300%) in extension, assuming benign US CPI (risk-positive) and steady oil. 

Technically, rising WMA and the pink regression band support “buy-the-dip” flows while price holds above the 1.6256–1.6260 cluster. 

Key Levels: 

• Resistance: 1.6328, 1.6445, 1.6586, 1.6706. 

• Support: 1.6256, 1.6134 (0% swing), and the channel lower rail. 

Alternative (CAD-positive shock / oil spike / hot US CPI): 

Failure to clear 1.6328 and a break below 1.6256 would signal a deeper mean-reversion toward 1.6134, where we’d reassess trend integrity vs. channel support. 

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