Elev8 Market Report: October Currency Shifts and November 2026 Outlook

Elev8, a global CFD broker, continues its Traders Outlook series. This installment examines the most significant currency movements of October 2026 and outlines the major events traders should monitor in November 2026.

October Market Overview

The chart below illustrates the performance of selected currencies during October 2026. Deep teal highlights major currencies and the U.S. Dollar Index (DXY). All currency performance is measured against the relevant USD benchmark exchange rate. For the Chinese renminbi, the onshore rate (USDCNY) is applied.

* USDCNY, onshore rate

** DXY (U.S. Dollar Index)

• Top-performing currencies: The Norwegian krone (NOK), Russian rouble (RUB), and Canadian dollar (CAD) led the 23 currencies tracked by Elev8.
• Weakest regional performers: The Brazilian real (BRL), Mexican peso (MXN), and Chilean peso (CLP) weakened due to a combination of political, monetary, and economic factors.
• Bank of Canada: The central bank raised its benchmark interest rate by 25 basis points to 2.50% on 28 October.
• November market drivers: U.S. midterm election results, oil prices, central bank divergence, China’s yuan policy, inflation, and competition for capital are the six major themes highlighted by Elev8.

Introduction

In October, choppy price action characterized major currency pairs. Key Latin American (LatAm) currencies—the Brazilian real (BRL), Mexican peso (MXN), and Chilean peso (CLP)—weakened, while oil-correlated commodity currencies such as the Norwegian krone (NOK), Russian rouble (RUB), and Canadian dollar (CAD) rallied. The common driver among the best performers was the surge in oil prices: Brent crude oil rose approximately 15% in October amid escalating conflict in the Middle East and attacks on shipping through the Strait of Hormuz. LatAm currencies weakened for distinct, mostly local reasons.

This article provides retail traders with market data and analytics to see more market context so they can respond effectively to changing conditions.

What Happened in October

NOK, RUB, and CAD

The conflict in the Strait of Hormuz, through which around one-fifth of global oil supplies pass, remained a persistent theme in October. It continued to hurt oil importers—notably European countries—pushing inflation expectations higher, increasing the probability of higher interest rates, and raising the risk of a potential recession in 2027. Unsurprisingly, the euro (EUR) was the worst-performing currency among the majors in October. At the same time, elevated oil prices provided a direct boost to current account surpluses and government revenues of major energy producers.

Norwegian Krone, Russian Rouble, and Canadian Dollar

NOK, RUB, and CAD were the best-performing currencies among the 23 currencies tracked by Elev8. Oil was a key driver.

For example, Russia’s oil and gas tax revenue was projected to rise 10% year-on-year in October to approximately 1 trillion roubles (USD 11.97 billion), boosted by higher global oil prices and quarterly tax payments. Revenue was expected to more than double compared with September, though cumulative January–October revenue was still estimated to be down 14% year-on-year. Diplomatic signals around potential trilateral U.S.–Russia–Ukraine talks also improved sentiment.

Apart from the energy windfall, NOK received an additional boost from indirect demand for the krone as traders piled into EURNOK short trades after political turbulence in France hit the bond market. At one point, the EURNOK pair was down some 16% since late April.

Regarding CAD, Canada is the world’s fourth-largest oil producer, so its export revenues were certainly boosted by the rally in crude oil. An additional bullish factor was monetary policy. The Bank of Canada (BoC) raised its benchmark interest rate by 25 basis points (bps) to 2.50% on 28 October, its first hike in more than three years. Governor Tiff Macklem said that “there could be a need to raise the policy rate further.” Moreover, the BoC sharply revised higher its 2027 inflation forecast from 2.0% to 3.1%.

Brazilian Real, Mexican Peso, and Chilean Peso

LatAm currencies suffered greatly in October, each for its particular reasons.

BRL performance was dominated by a single event: presidential elections. The Brazilian stock market rallied aggressively before the vote (scheduled on 25 October) on expectations that Senator Flavio Bolsonaro would defeat incumbent President Luiz Inacio Lula da Silva. However, Lula’s re-election triggered an immediate and violent reversal. USDBRL surged from 4.98 on 23 October to 5.41 on 26 October, a single-weekend devaluation of approximately 8.7%. In addition, Brazil’s fiscal challenges hurt investor sentiment. Reuters reported that the country’s debt reached $1.8 trillion as interest costs surged.

MXN dropped sharply in October as investors rapidly exited the popular “carry trade” amid rising market volatility and growing expectations that the Federal Reserve (Fed) may have to remain hawkish for longer. At the same time, hints that Mexico’s central bank was leaning dovish reduced the currency’s appeal compared to the U.S. dollar. So did uncertainty over the country’s trade negotiations with the U.S., with a resolution to the USMCA free-trade renegotiation yet to emerge.

CLP was in trouble due to local specifics. Local mining disruptions, including labor strikes and a scandal over fake production numbers at state miner Codelco, hurt investor sentiment. At the same time, Chile’s domestic unemployment climbed to its highest point since 2021, dampening confidence in the broader economy. In addition, as the world’s largest copper producer, the Chilean currency is particularly vulnerable to fears of a global recession, which have intensified recently amid surging oil prices.

What to Expect in November

Elev8 highlights six main themes for traders to watch in November:

1. The fallout from the U.S. midterm elections
2. Crude oil price (Middle East conflict)
3. Monetary policy divergence
4. China slowing yuan appreciation
5. Inflation risks
6. Cash deficit

First, the recent victory of the Democratic Party in the U.S. midterm elections has already weakened the dollar. Investors now expect less government spending, cooler inflation, and an easier path for the Fed. The key risk here is that investors may prove to be too optimistic.

Second, a Democratic sweep of Congress does not automatically solve the conflict in the Middle East. Therefore, the recent 8% drop in crude oil prices is based largely on hopes. Still, should energy prices continue to decline, oil-importing regions such as Europe and Japan will benefit, which may boost their currencies.

Third is what we at Elev8 call “central banks clash.” Right now, major central banks seem to be heading in different directions. While the Fed held rates steady, markets anticipate potential rate hikes from the Bank of England (BoE), the European Central Bank (ECB), and the Bank of Japan (BoJ). This divergence has the potential to create sharp swings across currency pairs.

Fourth, it is worth watching how China’s decision to devalue the yuan will impact other major currencies. China’s central bank (PBoC) raised the foreign exchange reserve requirement for local banks to cool down the yuan after months of steady gains against the greenback. This requirement may provide an indirect boost to other major currencies, notably USD, GBP, and EUR.

Fifth, despite the recent drop in crude oil prices, inflation risks are not going away. Consumer prices remain stubbornly high worldwide—especially in the Eurozone—keeping pressure on policymakers to maintain elevated interest rates. Furthermore, high consumer prices create political risks as social unrest may erupt over the rising cost of living, undermining government stability and influencing election outcomes.

Sixth is the cash deficit. It may sound strange, but competition for capital is actually intensifying. Governments need investors’ money to cover their huge deficits (U.S. debt alone is $40 trillion; with France, the UK, and Japan, the figure goes to $57 trillion). At the same time, global tech giants have pledged to spend more than $1 trillion on artificial intelligence. This competition for cash is pushing borrowing costs higher and fuelling market volatility.

Key Data and Events Calendar for November

Frequently Asked Questions (FAQ)

Which currencies performed best in October 2026?

According to Elev8’s analysis, the Norwegian krone (NOK), Russian rouble (RUB), and Canadian dollar (CAD) were the strongest performers among the 23 currencies tracked. Their gains were largely supported by higher crude oil prices, which benefited major energy-exporting economies.

Why did Latin American currencies weaken in October?

The Brazilian real (BRL), Mexican peso (MXN), and Chilean peso (CLP) faced different pressures. Brazil’s presidential election and fiscal concerns affected the real, while the Mexican peso suffered from carry trade unwinding and monetary policy uncertainty. The Chilean peso was pressured by mining disruptions, unemployment, and concerns about global economic growth.

How do rising oil prices affect currency markets?

Rising oil prices can support the currencies of major energy exporters by increasing export revenues and improving government finances. However, oil-importing economies may face higher inflation, increased economic pressure, and weaker currency performance.

What are the main currency market risks for November 2026?

Elev8 identifies six themes to monitor: the consequences of the U.S. midterm elections, developments in crude oil prices, differences in central bank monetary policies, China’s yuan management, persistent inflation risks, and increasing competition for global capital.

Why is monetary policy divergence important for forex traders?

When central banks move in different directions on interest rates, the relative attractiveness of their currencies can change. Differences between the policies of the Fed, BoE, ECB, and BoJ may contribute to volatility across major currency pairs.

Which economic events should forex traders watch in November?

The key events highlighted in Elev8’s November calendar include central bank decisions, U.S. employment data, the BoJ’s meeting summary, China’s foreign exchange reserve requirement change, FOMC-related developments, and the Fed Beige Book. These events may influence currency expectations and market volatility.

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