The latest Market Talks covering FX and Fixed Income. Published exclusively on Dow Jones Newswires throughout the day.
0939 ET - The hit to German business sentiment from the Iran war may have bottomed out based on the results of the monthly ZEW investor sentiment indicator, Oxford Economics economist Mateusz Urban says in a note. The headline index rose to minus 10.2 in May, from a multiyear low of minus 17.2 in April. The pickup is broadly in line with modest improvements in other surveys, as hopes rise of an end to Middle East hostilities relatively soon, with an ensuing normalization in energy prices, Urban says. "As such, it signals that the hit to sentiment has likely bottomed out, but we need firmer hard data evidence to say the same about real activity," he says. (edward.frankl@wsj.com)
0938 ET - It's too early to call for an "altcoin season," says Coinbase Research in a note. "Altcoin season" is typically seen when there is a strong rotation of capital out of mainstays like bitcoin and stablecoins into riskier alternatives--in hopes of capturing larger speculative gains. Many L1 tokens--tokens that trade using their own base blockchain instead of the blockchains of other larger coins--have seen strong gains recently, but not enough to declare a trend, says Coinbase. "Altcoin open-interest dominance has fallen to the lowest level in years… meaning altcoin leverage has not rebuilt alongside the stabilization in token valuations," says the firm. "This is therefore a majors & bitcoin-led market with improving institutional demand, not yet an 'alt season'." (kirk.maltais@wsj.com)
0934 ET - Major cryptocurrencies are under pressure this morning, pulling back from recent gains that many L1 blockchains saw late last week and this past weekend. However, bitcoin remains above the $80,000 threshold, and is in fact trading at $80,864. In addition to the increased demand for BTC coming from ETFs, bitcoin is also seeing more "conviction buyers"--wallets that accumulate BTC and "HODL" in lieu of actively trading it. Citing data from BitGo Research, analysts with Bitfinex say that these buyers are purchasing the most bitcoin they have since the Covid-19 pandemic. "Prior peaks in this metric have historically preceded major price recoveries, as reduced sell-side pressure from long-term holders tightens available supply," says Bitfinex. (kirk.maltais@wsj.com)
0924 ET - Sterling's more contained response to U.K. political uncertainty compared to U.K. government bonds isn't surprising, strategists at Unicredit's The Investment Institute say in a note. The political crisis concerns public finances and rising borrowing costs which tend to impact the gilt market first, they say. "Sterling is also benefiting from the indirect support offered by a less-buoyant dollar." Investors remain optimistic that the Middle East conflict will ease, driving safe-haven flows away from the dollar, they say. Sterling earlier reached a near two-week low of $1.3499 while 30-year gilts reached their highest since 1998 at 5.813%, LSEG data show. The moves come as Prime Minister Keir Starmer faces increasing pressure to step down. (renae.dyer@wsj.com)
0920 ET - The second consecutive CPI reading above 3% strengthens the case for a Fed hike, Regan Capital's Skyler Weinand writes. Consumer prices rose 3.8% from a year ago through April, topping forecasts of 3.7%. Meanwhile, other indicators point to a resilient economy. "The inflation and employment data as of late suggests that the Federal Reserve's next move should be a rate hike, and not a rate cut," Weinand says. But it won't be easy for the Fed. Given "the pressure facing incoming Chair Warsh, we think a rate hike is unlikely," he says. (paulo.trevisani@wsj.com; @ptrevisani)
0909 ET - Price increases moderated in categories of goods sensitive to tariffs, bolstering the case that effects from President Trump's levies are fading. Goods prices excluding food and energy were flat in April. Household-furnishings prices declined 0.5%, falling for a second straight month. Apparel prices cooled, rising by 0.6% after climbing by 1.3% in February and 1% in March. Appliance prices fell by 0.4%, dropping further after a 1.6% March decline. (matt.grossman@wsj.com; @mattgrossman)
0904 ET - Gold prices fall but remain above $4,700 a troy ounce after the latest U.S. data showed inflation soared in April, driven by higher gasoline prices. U.S. consumer prices rose 3.8% last month, surpassing the previous month's reported increase of 3.3% and expectations of a 3.7% rise. In afternoon European trading, New York futures are down 0.4% to $4,710.70 a troy ounce. Meanwhile, the U.S. dollar index--which measures the greenback against a basket of major currencies--is up 0.3% to 98.24. (giulia.petroni@wsj.com)
0900 ET - Airfares rose 2.8% in April, after rising by 2.7% in March. Higher fuel costs amid the war in Iran have accelerated price increases for airlines. Overall, airline ticket prices are up 21% from a year ago. That is the fastest 12-month increase since early 2023. (matt.grossman@wsj.com; @mattgrossman)
0857 ET - Last year, during a government shutdown, the BLS wasn't able to collect housing-price data in October and reported zero housing inflation for the month. Because domicile prices are sampled on a six month rotation, the April inflation data returns to the set of properties missed in October, so the data show housing prices snapping back. The BLS's methodology show rental housing prices rose 0.6% in April, sharply higher than the 0.3% March increase. Prices for owned housing were up 0.5%, versus 0.3% in March. These sharp increases reflect the statistical quirk more than a changing economic reality. (matt.grossman@wsj.com; @mattgrossman)
0854 ET - Sterling and U.K. government bonds, or gilts, face further weakness in coming days due to uncertainty over Prime Minister Keir Starmer's future, Societe Generale's Kit Juckes says in a note. "One fear is that the shift of power from Starmer to any successor could play out slowly." Starmer is resisting pressure to resign. Furthermore, the bookmakers' favorite to replace him, Greater Manchester Mayor Andy Burnham, might struggle to make his way back to parliament. Whatever happens there will be a period of uncertainty about future Labour policies, he says. Sterling falls 0.5% to $1.3537. The euro rises 0.25% to 0.8676 pounds. The 10-year gilt yield rises nearly 11 basis points to 5.104%, Tradeweb data show. (renae.dyer@wsj.com)
0847 ET - Treasury yields rise as U.S. inflation accelerates while Middle East tensions remain high. Consumer prices rise at a 3.8% 12-month pace, accelerating from 3.3% in March. Economists surveyed by WSJ expected 3.7%. Core CPI accelerates to 2.8% from 2.6%, beating consensus of 2.7%. These figures likely spur bets on a hawkish Fed. President Trump and China's Xi Jinping are expected to discuss the U.S. conflict with Iran this week. A 10-year Treasury note auction should have "moderate-to-soft demand as investors remain cautious," Spartan's Peter Cardillo writes. The 10-year is at 4.431%, up from 4.411% yesterday. The two-year rises to 3.971% from 3.946%, both off early highs. WSJ Dollar Index rises 0.3%.(paulo.trevisani@wsj.com; @ptrevisani)
0741 ET - Bitcoin stays under pressure as efforts to resolve the Iran war show little sign of progress and as the recent rally in tech stocks pauses. President Trump on Monday said the cease-fire with Iran is on "life support" as he rejected Tehran's response to the latest U.S. peace offer. Cryptocurrencies could either fall along with other risky assets or become a "flight to safety" trade for investors if the cease-fire breaks down, Trade Nation's David Morrison says in a note. Bitcoin falls 1.4% to $80,619, LSEG data show. The $80,000 level "could become an important area over the rest of this week, particularly if geopolitical tensions continue to rise," Morrison says. (renae.dyer@wsj.com)
(END) Dow Jones Newswires
May 12, 2026 09:39 ET (13:39 GMT)
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