The latest Market Talks covering FX and Fixed Income. Published exclusively on Dow Jones Newswires throughout the day.
0827 GMT - The dollar is unlikely to enter a sustained downward trend after Thursday's worse-than-expected U.S. nonfarm payrolls report, ING's Francesco Pesole says in a note. The data aren't weak enough on their own to trigger a significant repricing in rate rise bets for the Federal Reserve, he says. While markets scaled back the prospect of imminent tightening, there is still more than 25 basis points priced in by December. The DXY dollar index falls 0.2% to 100.691 and ING expects it to stabilize in a range of 100.0-101.500 in coming weeks. (renae.dyer@wsj.com)
0824 GMT - Thailand's economic growth is likely to pick up in 2H, since the U.S.-Iran hostilities paused in late June and the Strait of Hormuz gradually reopened, Maybank economists say in a report. Thailand is one of the Asean economies that is more exposed to the Gulf shock through supply disruptions and shortages as well as higher input costs. However, the Middle East truce should lead to a lower risk of slowing growth, they note. Maybank expects Thailand's GDP growth to come in at 2.2% in 2H and average 2.1% in 2026, before accelerating to 2.7% in 2027. (amanda.lee@wsj.com)
0804 GMT - The euro's modest rise against the dollar after Thursday's weak U.S. nonfarm payrolls data highlights the lack of a convincing positive narrative for the single currency, ING's Francesco Pesole says. That largely reflects doubts the European Central Bank will raise interest rates again, he says in a note. There's a risk markets price out all ECB rate rises before they do the same for Federal Reserve tightening, he says. The paring of Fed rate rise bets could still support the euro-dollar exchange rate as it reacts more to U.S. rates, but its recovery might be slow, he says. The euro rises 0.2% to $1.1453, and ING expects it won't return to above $1.16 until late in the summer. (renae.dyer@wsj.com)
0803 GMT - French industry is on track for a solid second quarter, helped by stronger capital goods production despite a small retreat in May, Pantheon Macroeconomics' Claus Vistesen says in a note. Industrial production edged down 0.1% on month in May, having risen 0.3% in April. Production in May was lifted by a surge in energy output, though output of machinery and transport dipped. But over the quarter as a whole, production of transport equipment--mainly aircraft--remains on track for a solid increase, as does output of machinery and equipment more broadly, Vistesen says. (edward.frankl@wsj.com)
0715 GMT - Eurozone government bond yield spreads continued to widen this week, driven by the French OAT-German Bund yield spread and supply pressure, Societe Generale rates strategists say. Supply pressure arises from France's 14 billion euro auction of long-dated OATs on Thursday. However, with supply set to fade into the summer, there is room for narrower spreads near term, they say. "If summer seasonality is at play, we should see some tightening in the coming weeks." Beyond that, markets are likely to refocus on fiscal dynamics, foreign flows and French political risk, the strategists say. "We expect OATs to underperform [Italian] BTPs and Spanish government bonds amid renewed political stress." The 10-year OAT-Bund yield spread is 77 basis points, according to Tradeweb. (emese.bartha@wsj.com)
0713 GMT - Eurozone government bond yields rise in early trade and the trend could continue throughout the day, Commerzbank's Hauke Siemssen says in a note. "Without a circuit breaker in sight and the U.S. out on holiday, the bearish dynamics could continue ahead of the weekend," the rates strategist says. "Long-end EGBs remain under pressure with the curve steepening from both sides," he says. The rates strategist points to the bearish dynamics with long-end Japanese government bonds under renewed pressure this week. Eurozone 10-year government bond yields rise by between 1.6 basis points and 2.6 basis points, with the 10-year German Bund yield up 2.1 basis points at 2.919%, according to Tradeweb. (emese.bartha@wsj.com)
0710 GMT - Japanese authorities could refrain from interventions to support the yen on Friday as some expect, Commerzbank's Volkmar Baur says in a note. Friday is a U.S. public holiday and liquidity will be thinner, he says. "While this would be a good time for another intervention--and of course, that can't be ruled out--the pressure for a genuine intervention is likely to be low as long as the dollar can hold steady at 161 yen today." The dollar last trades down 0.2% at 160.88 yen, having reached a two-week low of 160.51 earlier, LSEG data show. The yen is supported by another intervention warning from Japanese Finance Minister Satsuki Katayama and Thursday's weak U.S. nonfarm payrolls data. (renae.dyer@wsj.com)
0656 GMT - The Japanese yen rises to a two-week high against the dollar after Japan's finance minister delivered a fresh warning about potential interventions to support the currency. Satsuki Katayama said Friday that Japan stands ready to take "appropriate action at any time as needed." The comments fuel speculation that Japanese authorities could intervene as soon as Friday when there is reduced liquidity due to the U.S. public holiday. The yen is also supported by a weaker dollar after Thursday's softer-than-expected U.S. jobs data reduced rate rise expectations. The dollar falls to as low as 160.51 yen.(renae.dyer@wsj.com)
0647 GMT - Japanese government bonds are leading the global bond selloff, driven by quarter-opening seasonality and supply pressure, Societe Generale rates strategists say in a note. History suggests that long-end weakness may have further to run, particularly through the July auction cycle. At the same time, Prime Minister Sanae Takaichi's attempts to fiscally dominate monetary policy are colliding with solid fundamental data, they say. "PM's pressure keeps the front end anchored low, but the resulting distortion is spilling into the belly [intermediate segment of the curve] with behind the curve risk," they say. Societe Generale maintains a bearish view on the "belly". (emese.bartha@wsj.com)
0638 GMT - Sustainable yen appreciation can't happen without the Japanese government's firm commitment to fiscal consolidation, says SMBC Nikko Securities strategist Makoto Noji. The recent widening gap between short- and long-term yields in Western bond markets suggests Japan has begun exporting its "bad" yield rises triggered by fiscal fears, he says. If the U.S. conducts a rate check like it did earlier this year, the yen's appreciation could accelerate, Noji says, adding that such U.S. action could be a signal that the U.S. is demanding that Japan improve its fiscal conditions. The dollar is last at 160.97 yen. (megumi.fujikawa@wsj.com)
0637 GMT - Bitcoin rises after hitting a one-week high on Thursday following softer-than-forecast U.S. jobs data. Nonfarm payrolls rose 57,000 in June, well below the 115,000 forecast by economists in a WSJ survey, data showed Thursday. The data prompted markets to scale back expectations for interest rate rises by the Federal Reserve, supporting risk sentiment. Bitcoin is up 0.2% at $61,662 after reaching as high as $62,128 on Thursday, LSEG data show.(renae.dyer@wsj.com)
0628 GMT - The dollar stays under pressure after weaker-than-expected U.S. nonfarm payrolls data damped expectations of a rise in interest rates. Data Thursday showed American employers added 57,000 new jobs in June, well below the 115,000 forecast by economists in a WSJ survey, while prints for May and April were revised lower. "The payroll data support our view that the Federal Reserve will not hike rates this year," Jefferies economist Mohit Kumar says in a note. The U.S. economy remains resilient but the jobs data argue against rate rises, he says. The DXY dollar index falls 0.1% to 100.686 after reaching a two-week low of 100.558 Thursday. Friday is a U.S. public holiday, meaning fewer traders and reduced liquidity. (renae.dyer@wsj.com)
(END) Dow Jones Newswires
July 03, 2026 04:27 ET (08:27 GMT)
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