The latest Market Talks covering FX and Fixed Income. Published exclusively on Dow Jones Newswires throughout the day.
1102 ET - Markets overestimate the likelihood of interest-rate increases by the Fed, SignatureFD's Tony Welch says. Futures markets price lower odds of a hike this month following June's soft CPI inflation data, but at least one rate increase this year remains in the cards, according to CME. Welch says inflation is trending lower, regardless of volatile fuel prices. "We just are not seeing the types of wage gains that would support broad economy-wide inflation for a long period of time," he says. He expects Chairman Warsh to try to keep inflation expectations around the Fed's 2% target. "I do believe he's trying to use his words to help set, keep inflation expectations anchored," he says. (paulo.trevisani@wsj.com; @ptrevisani)
1055 ET - Yields on U.K. government bonds, or gilts, could fall over the coming months as a weak economy could cause the Bank of England to cut interest rates, Capital Economics' Joe Maher says in a note. Potentially, the latest Middle East escalation could result in the BOE increasing interest rates. However, if tensions ease and oil prices fall, this is less likely, Maher says. "We expect CPI inflation will fall to the Bank's 2% target in 2027 on account of a weak labor market." Ten-year gilt yields could fall to 4.50% by the end of 2026, he says. Ten-year gilt yields are up 1.3 basis points at 4.976%, having earlier hit an 8-week high of 5.047%, Tradeweb data show. (miriam.mukuru@wsj.com)
1037 ET - Major Gulf stock indexes fall, extending recent losses across the region. This follows renewed hostilities between the U.S. and Iran which have sparked fears over supply through the Strait of Hormuz. Growth in the Middle East and Central Asia is forecast to drop sharply to 0.7% in 2026 from 3.7% in 2025, before rebounding to 6.5% in 2027, the International Monetary Fund says in its July World Economic Outlook. The IMF says the downgrade is consistent with a longer closure of the Strait of Hormuz than assumed in April. The Dubai Financial Market General Index falls 1.3%; Saudi Arabia's Tadawul All Share Index loses 0.8%; and Abu Dhabi's benchmark index drops 0.5%. Qatar's market is closed for an official mourning holiday. (farhan.rafid@wsj.com)
1006 ET - It's still a buyer's market in the U.S., Redfin says. There were an estimated 48.5% more home sellers than buyers in June, down slightly from 48.7% the month before and a peak of 50.1% in December. The biggest hurdle for Americans looking to buy a home is affordability, Redfin says, but those with the budget to move now--even in the face of record-high home prices and stubbornly high mortgage rates--have the power. There were an estimated 1.5 million sellers in the market in June, while there were an estimated 1 million buyers. Roughly 70% of U.S. housing markets are currently buyer's markets. The nation's leading buyer's markets are concentrated in the Sun Belt, where homebuying demand has been slow for several years after the pandemic boom. (chris.wack@wsj.com)
1004 ET - The dollar faces further falls after data Tuesday showed U.S. inflation eased more than expected in June, Monex Europe analyst Nick Rees says in a note. Monex continues to expect unchanged rates from the Federal Reserve in 2026, subject to the present Middle East tensions cooling and oil prices remaining contained, he says. That could weaken the dollar given markets are still pricing in a rate rise by year-end, he says. The DXY dollar index falls 0.5% to 100.693. The data showed inflation cooled to 3.5% in June, below the 3.8% forecast by economists in a WSJ survey. (renae.dyer@wsj.com)
1001 ET - Gold prices climb 2% as a cooler-than-expected U.S. inflation reading weighs on the dollar and boosts hopes for a less hawkish Federal Reserve. Consumer prices were up 3.5% in June from a year earlier, slowing more than expected and improving from the 4.2% inflation rate in May, leading investors to reduce bets that the Federal Reserve will raise rates at its meeting at the end of the month. Gold futures in New York are up 2% to $4,084.50 a troy ounce. The U.S. dollar index is down 0.5% to 100.70, making dollar-denominated commodities less expensive for overseas buyers. (giulia.petroni@wsj.com)
0936 ET - The U.S.-Iran war is driving up oil prices, raising inflation risk and the possibility of interest rates staying high, eToro's Lale Akoner says in a note. This could be bad news for bonds and stocks such as property, utilities and expensive growth stocks, she says. "Unless oil supplies are hit more seriously, the biggest market impact is likely to stay focused on oil prices, inflation expectations and investments most exposed to interest rates," Akoner says. Investors price in 42 basis points of interest-rate rises by the Bank of England in 2026, LSEG data show. (miriam.mukuru@wsj.com)
0927 ET - While June's CPI may offer some relief, some economists are still predicting a rate hike this year. The AI investment boom coupled with rebounding consumer demand will continue to keep core inflation above target, wrote Stephen Brown, Chief North America Economist at Capital Economics. "We still think it's a matter of when, rather than if, the Fed will raise interest rates," Brown says.(jessica.coacci@wsj.com)
0915 ET - Cooler-than-expected U.S. inflation weighs on the dollar. The BLS says consumer prices declined 0.4% last month and rose 3.5% in 12 months, in both cases softer than consensus. The data ease pressure on the Fed to raise rates this month. The dollar "is retreating against its major rivals, extending an overnight decline against its commodity- and rate-sensitive counterparts alike as traders pull back on expectations for a July rate hike," Corpay's Karl Schamotta writes. The WSJ Dollar Index and the DXY both fall 0.5% as the greenback weakens 0.8% against the Swiss franc, 0.6% against the euro and 0.4% versus the yen. (paulo.trevisani@wsj.com; @ptrevisani)
0906 ET - Bitcoin extends its gains modestly after lower-than-expected U.S. inflation data reduce the odds of the Federal Reserve raising interest rates in the immediate term. Annual CPI inflation eased to 3.5% in June, below the 3.8% expected by economists in a WSJ survey. Core inflation also cooled to 2.6%, missing the 2.9% forecast. Markets see a much lower chance of the Fed lifting rates on July 30 and are not fully pricing a rise until December, LSEG data show. Higher rates tend to weigh on risk appetite, which is negative for cryptocurrencies. Bitcoin rises 2.6% to an intraday high of $63,785 after the data from $62,874 beforehand, according to LSEG. (renae.dyer@wsj.com)
0901 ET - Odds of an interest rate increase by the Fed this month are down to 17% on the CME's FedWatch tool, after softer-than-expected June inflation. That compares to 42% yesterday. June CPI shows a 0.4% monthly decline and a 12-month 3.5% increase, indicating that prices were softer than economists forecast. Even without last month's sharp decline in oil prices, the inflation figures were better than expected. "This data exceeded our expectations and significantly reduces, if not negates, the chances of a rate hike this month," Spartan's Peter Cardillo writes. Markets mostly price at least one hike by year end, according to FedWatch. (paulo.trevisani@wsj.com; @ptrevisani)
0859 ET - Yields on U.K. government bonds, or gilts, trim their rise following weaker-than-expected U.S. inflation data for June although they remain higher on the day. Annual U.S. headline inflation stood at 3.5% in June, below the 3.8% consensus forecast by economists in a WSJ survey. Monthly headline inflation slowed to minus 0.4%, weaker than the consensus forecast of minus 0.2%. Ten-year gilt yields last trade at 4.994%, down from 5.003% prior to the data release and below an earlier eight-week high of 5.047%, Tradeweb data show. (miriam.mukuru@wsj.com)
(END) Dow Jones Newswires
July 14, 2026 11:02 ET (15:02 GMT)
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