The latest Market Talks covering FX and Fixed Income. Published exclusively on Dow Jones Newswires throughout the day.
0841 ET - The dollar's recent upward momentum looks set to moderate, TD Securities forex strategists say in a note. The DXY dollar index is approaching the 102.000 resistance level and the uptrend looks stretched, they say. Sustained dollar appreciation would likely require weaker economic growth outside the U.S. and the Federal Reserve raising interest rates more than markets expect, they say. "As global growth stabilizes, risk premia fade, and central banks narrow rate differentials versus a Fed on hold, dollar downside should re-emerge later this year." The DXY falls 0.2% to 101.232, having reached a 13-month high of 101.800 Wednesday. (renae.dyer@wsj.com)
0833 ET - Yields on U.K. long-dated government bonds could stay elevated as investors demand extra compensation due to worries about U.K. public finances, J. Safra Sarasin Sustainable Asset Management's Alex Rohner says in a note. The new U.K. leadership team could demand additional funding to meet rising public spending needs, he says. U.K. 30-year gilt yields rise 5 basis points to last trade at 5.457%, Tradeweb data show. (miriam.mukuru@wsj.com)
0733 ET - Bitcoin slips back below $60,000 as U.S. stock futures fall driven by losses in tech stocks. Apple's decision to raise prices of its major products due to rising memory and storage chip costs has sparked fears about the sustainability of the AI boom, XM analyst Raffi Boyadjian says in a note. It raises concerns that other companies will also hike prices as massive investments in AI lead to an unprecedented demand for memory and storage chips, he says. Consumer demand for tech and AI products could eventually cool, "bringing into question whether all the spending on AI infrastructure will pay off." Bitcoin trades flat at $59,360, having reached a 21-month low of $58,075 Thursday, LSEG data show. (renae.dyer@wsj.com)
0717 ET - Yields on U.K. two-year gilts fall to the lowest since March as investors cut back their bets on the Bank of England interest-rate rises. The prospects of the BOE increasing interest rates in the coming months have dropped as oil prices continue to fall, easing concerns about inflation risk. Investors currently price in a total of 19 basis points of BOE rate rises in 2026, down from 25bps of hikes priced in a week ago, LSEG data show. Two-year gilt yields are down 2 basis points to last trade at 4.098%, having dropped to a three-month low of 4.080% earlier in the session, Tradeweb data show. (miriam.mukuru@wsj.com)
0659 ET - The Federal Reserve will hold interest rates in the remainder of the year, according to Pimco's base case, economist Tiffany Wilding says in a note. "Because inflation has been so elevated in the first five months of the year, the Fed will likely need to see an actual moderation in inflation before thinking about moving rates," she says. However, recent developments should relieve some of the inflationary worries from those Federal Open Market Committee participants who thought policy rates would need to be higher by the end of the year, Wilding says. "As of the June SEP [Summary of Economic Projections], the committee was divided as to whether to hike rates or remain on hold," she writes. (emese.bartha@wsj.com)
0658 ET - Given expansionary fiscal policy, the outlook for longer-dated bonds might not be as clear as on the short end, BlueBay Asset Management's fixed income CIO Mark Dowding says in a note. "With 30-year Bund yields at levels matching where they were trading at the start of 2026, we think that gains are more likely to be earned in shorter and intermediate maturities," he says. The 30-year Bund yield last trades at 3.408% versus 3.538% at the beginning of the year, according to LSEG data. With eurozone PMI data highlighting a soft backdrop for economic activity, "we are more inclined to think that the ECB may now be done hiking," Dowding says. From this point of view, "we continue to view two-year swaps at 2.75% as attractively priced." (emese.bartha@wsj.com)
0626 ET - RBC BlueBay Asset Management continues to hold a constructive view on long-dated Japanese government bonds. "Unlike other global curves, which are very flat, the curve in Japan is exceptionally steep," BlueBay fixed income CIO Mark Dowding says in a note. In this way, there is plenty of protection in longer-dated bond yields with 30-year securities above 3.75%, he says. The 30-year JGB yield last trades at 3.79%, according to LSEG. (emese.bartha@wsj.com)
0603 ET - Sterling remains at risk of weakening unless there is a credible fiscal plan from Andy Burnham, the front-runner to replace U.K. Prime Minister Keir Starmer, Monex Europe analysts say in a note. Starmer announced his resignation on Monday and now the attention is squarely on Burnham's plans to fix the economy, his choice for Treasury chief and the timing of the next budget, they say. A change in leadership does little to resolve the U.K.'s underlying fiscal challenges and the International Monetary Fund's warnings that the U.K. faces the largest Iran-war growth hit of any major economy, they say. Sterling rises 0.2% to $1.3220 against a weaker dollar but falls 0.1% to 0.8627 a euro. (renae.dyer@wsj.com)
0603 ET - The Reserve Bank of India will likely deliver two 25-basis-point rate increases in 4Q, HSBC economists say. "Amid falling oil prices but rising El Niño risks, we forecast a slightly improved growth-inflation mix, but challenges remain," they write in a note. Inflation sitting closer to the top of the 2%-6% tolerance band for around six months is hard to ignore, say the economists, who expect inflation at 5.1% this fiscal year. However, the tightening cycle will be shallow, as inflation is expected to fall back to 4% in the next fiscal year, while growth is projected to weaken from the September quarter, they add. (kimberley.kao@wsj.com)
0552 ET - U.S. Treasury yields fall, except for stable ultralong-end yields, and the U.S. dollar is also lower in European trade, with Thursday's PCE inflation data easing some concerns over the path of inflation. "Although the figures remained well above the Federal Reserve's 2% target, the data broadly matched market expectations, prompting Treasury yields to retreat modestly," Hola Prime's Somesh Kapuria says in a note. "The decline extended into Friday, weighing on the dollar." The two-year U.S. Treasury yield falls 3.1 basis points to 4.089%, while the 10-year yield is down 1.4 basis points at 4.377%, according to Tradeweb. The DXY dollar index falls 0.2% to 101.208. Diplomatic progress in the U.S.-Iran talks could reduce demand for safe-haven assets, weighing on the dollar, Kapuria says. (emese.bartha@wsj.com)
0541 ET - Heightened competition for memory chips amid increasing investment in artificial intelligence is already showing up in consumer prices, James Bull at RSM UK says in a note. Both Apple and Microsoft have now issued price hikes, confirming an industry-wide response to supply-chain shortages, Bull says. "The four largest U.S. technology companies are forecast to spend $725 billion on data centers and AI equipment in 2026 alone. That level of demand for memory chips has created a shortage the supply chain cannot keep pace with." It is now clear that the costs of building the AI economy is being passed onto consumers and potentially even the inflation outlook, with industry leaders suggesting shortages could last beyond 2028, Bull adds. (don.forbes@wsj.com)
0534 ET - Even in a period of rising interest rates, investor enthusiasm for high-yield credit remains strong, Payden & Rygel's Jordan Lopez says in a webinar. "I think the higher interest rates for high-yield corporate debt isn't necessarily negative," the head of the high-yield strategy group says. "Obviously, it's painful on the way up, but most high-yield buyers are actually yield buyers, they're not necessarily spread buyers." Investors focus on the all-in yield, which is currently above 7% for U.S. high-yield, rather than just on the credit spreads, he says. Most high-yield buyers, when they are looking at whether or not to make an investment, consider the all-in yield, he says. (emese.bartha@wsj.com)
(END) Dow Jones Newswires
June 26, 2026 08:41 ET (12:41 GMT)
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