Forex Market Forecast for November 2025

Key Points

• Bank of England Rate Decision (November 6): With some market participants pricing in a potential rate cut, the BoE’s decision will be the key driver for the GBP. Reuters said in a recent report that current pricing indicates a 40% chance of a 25 basis point cut.
• U.S. Government Shutdown & Data: The political stalemate and continued lack of official U.S. economic data (like Non-Farm Payrolls) mean reports, such as the ADP Non-Farm Employment Change and ISM data, are taking on outsized importance for USD sentiment.
• UK Autumn Budget (November 26): The highly anticipated fiscal statement will shape the medium-term outlook for the pound. Markets fear a reliance on tax hikes could cap growth, while any surprise change in the Chancellor’s post could trigger volatility.

US Dollar (USD)

The U.S. dollar received a strong tailwind from Fed Chair Powell’s caution on a potential December rate cut, suggesting that it is not a foregone conclusion. This saw the dollar firm up across the board, despite the ongoing government shutdown delaying crucial economic releases.

The lack of official data, particularly the NFP, prevents markets from making a conviction call on slower Fed easing. 

ING strategists suggest that without compelling negative news, the dollar lacks the thrust for a sustained rebound or a definitive break above the DXY 100.0 level. They maintain a short-term call of “lack of direction” for the dollar index. Private data will be scrutinised for clues on the U.S. economy’s health, offering temporary volatility in the data void.

Key Levels:

• EUR/USD: Higher – 1.1820, Lower – 1.1400
• GBP/USD: Higher – 1.3590, Lower – 1.3020
• USD/JPY: Higher – 157.80, Lower – 151.00

Euro (EUR)

The euro showed respectable resilience into November, supported by the ECB’s firm stance, but in the last week of the month it declined against the USD. 

The central bank kept its key interest rate at 2% and indicated that the bar for further easing remains high, dismissing immediate rate cut needs. This stability was reinforced by better-than-expected Eurozone third-quarter GDP growth of 0.2% QoQ.

The EUR/USD pair remains heavily influenced by dollar dynamics. Post-FOMC price action has led to speculation of a potential break below the key 1.15 level. 

However, ING analysts are bullish on EUR/USD into year-end, arguing that the combination of a firm ECB, improved Eurozone growth, and a potentially peaking hawkish repricing of the Fed should limit the downside. The euro may also benefit if the U.S. government shutdown continues to erode confidence in the dollar.

Key Levels:

• EUR/USD: Higher – 1.1820, Lower – 1.1400
• EUR/GBP: Higher – 0.8850, Lower – 0.8600

British Pound (GBP)

The British pound had a bad close to October, tumbling to a six-month low against the dollar. The currency is under pressure from domestic concerns, chief among them the looming Autumn Budget. Market anxiety centres on a potential reliance on tax hikes, which could stifle growth.

The upcoming BoE rate decision on November 7th is a major risk event. Analysts note that a break below the critical 1.3140 support area for GBP/USD risks a further slide. 

The political drama surrounding Chancellor Rachel Reeves, although apparently quelled, also highlights market nervousness over the UK’s fiscal path. 

ING said in a recent note that a change in Chancellor would be bad for markets, while their base case for the Autumn budget suggests that Rachel Reeves will deliver a combination of tax hikes while avoiding the more inflationary measures. 

“That has gradually been priced in by markets via some dovish BoE repricing, lower gilt yields and a weaker pound. Our post-budget EUR/GBP target is 0.880 on the back of that,” said the firm.

Key Levels:

• GBP/USD: Higher – 1.3590, Lower – 1.3020
• EUR/GBP: Higher – 0.8850, Lower – 0.8600

Japanese Yen (JPY)

The Japanese yen’s weakness prompted comments from Finance Minister Katayama, confirming that the rate of change is a major concern. 

These comments provided a temporary boost, but the overarching theme remains a tug-of-war between the BOJ’s cautiousness and the tolerance for a weak currency.

While the BOJ kept rates at 0.5% in October, the hawkish dissent from two board members, coupled suggests a December hike remains a live possibility, with Governor Kazuo Ueda saying the likelihood of the BOJ’s baseline projection occurring has “heightened somewhat.” 

The yen’s direction in November will be highly sensitive to any further verbal or actual intervention and incoming Japanese inflation data.

Key Levels:

• USD/JPY: Higher – 157.80, Lower – 151.00
• EUR/JPY: Higher – 180.00, Lower – 175.50