Global Forex and Fixed Income Roundup: Market Talk

The latest Market Talks covering FX and Fixed Income. Published exclusively on Dow Jones Newswires throughout the day.

0822 GMT - Copper extended its record-breaking rally, surging above $14,790 a metric ton as supply shortages and tariff fears continue to drive sentiment. Still, "the speed of copper's rise and the continued narrowing in backwardation reduce the confirmation from nearby fundamentals," analysts at Sucden Financial say. A narrowing in backwardation means the gap between near-term and future copper prices is getting smaller. "A sustained hold above $14,700 a ton could keep systematic and options-related buying active, although a stronger U.S. inflation print could trigger a sharper correction through higher yields and reduced liquidity." In early European trading, three-month futures on the LME tick 0.1% lower to $14,792 a ton. (giulia.petroni@wsj.com)

0811 GMT - U.K. government bonds, or gilts, maturing in 2030 have declined in price over recent trading sessions ahead of a May 2030 gilt auction, RBC Capital Markets strategists say in a note. The Debt Management Office auction due at 0900 GMT should get support from attractive pricing in the sector, the strategists say. (miriam.mukuru@wsj.com)

0728 GMT - Yields on U.K. government bonds, or gilts, fall tracking their U.S. equivalents as market focus is on the U.S. inflation data due on Thursday and Friday. The producer price index data is due at 1230 GMT and the U.S. consumer price index data is set to be released on Friday. The data is likely to provide clues on the possibility of an interest rate increase by the U.S. Federal Reserve next week. Markets price in a 59% chance of a Fed rate hike in September. Ten-year gilt yields fall 1 basis point to last trade at 5.241%, having hit a one-week high of 5.270% on Wednesday, Tradeweb data show. (miriam.mukuru@wsj.com)

0645 GMT - Eurozone government bond yields edge lower, tracking the direction of U.S. Treasury yields. The key driver for eurozone bond yields on Thursday, nevertheless, is the European Central Bank's monetary policy decision for which a 25-basis-point interest-rate hike is fully priced, according to LSEG data. The key question for investors at the meeting is what signals the ECB will provide for the coming months. "We expect the central bank to stick with a hawkish short term message, aligning with the currently discounted third rate hike come December," KBC Bank analysts say in a note. "From a market point of view, the key question is whether hawkish expectations for 2027 will be confirmed as well." The 10-year Bund yield declines 0.2 basis points to 3.426%, according to Tradeweb. (emese.bartha@wsj.com)

0639 GMT - The U.S. dollar falls slightly alongside slightly lower oil prices and Treasury yields, awaiting input from Thursday's PPI and Friday's CPI data for August. "Despite higher energy prices and firm short-dated U.S. interest rates, the dollar remains soft," ING's Chris Turner says in a note. The fact that the dollar is not stronger may be attributable to both the investment environment and to developments in the U.S. dollar-Japanese yen currency pair, the global head of markets says. The DXY index falls 0.1% to 98.738. (emese.bartha@wsj.com)

0636 GMT - For the dollar, the implications of increased U.S. Treasury intervention may prove more lasting than for the yields themselves, Ebury's Roman Ziruk says in a note. "Buybacks were never designed to fix the deficit, but the market's reading of why the Treasury felt compelled to intervene and reach for tools beyond the norm has itself become a source of risk premium," the lead FX strategist says. That is a break from the textbook relationship, where higher yields should support a currency by attracting capital, he says. "Instead, the dollar has struggled even as yields climbed, because investors increasingly read this as a symptom of fiscal and institutional strain rather than economic strength." (emese.bartha@wsj.com)

0600 GMT - The $6 billion volume for the U.S. Treasury's increased-volume long-end securities buyback operation sounds like a large number, but it is still relatively small compared with the U.S. Treasury debt outstanding, BondBloxx Investment Management's JoAnne Bianco says in a note. "Investors may have been looking for a stronger signal that Treasury was willing to meaningfully offset the supply pressures that have been pushing long-term yields higher," the senior investment strategist says. Instead, the Treasury's announcement appears to be more of a liquidity management tool than a meaningful change in Treasury's broader debt management strategy, she says. (emese.bartha@wsj.com)

0552 GMT - The U.S. Treasury's 30-year bond auction is expected to attract solid demand, J.P. Morgan rates strategists say in a note. "Given the historically attractive yield and fair valuations, we think tomorrow's [Thursday's] auction will be digested relatively smoothly," they say. The Treasury will auction $22 billion in the 30-year bonds on Thursday. The 30-year Treasury yield is down 0.1 basis point to 5.285%, according to Tradeweb. (emese.bartha@wsj.com)

0548 GMT - U.S. Treasury yields decline in Asian afternoon trade but stay close to recent multiyear highs ahead of the Treasury's first long-end bond buyback operation with increased volume. The Treasury announced Wednesday it would buy a maximum of $6 billion in 10-year notes and 20-year bonds at the upcoming operation. "We are not surprised by the announcement, given long-end buybacks tend to be concentrated in substantially fewer CUSIPs [a number identifying most financial instruments] than elsewhere along the curve, and this should limit Treasury's ability to substantially upsize these operations," J.P. Morgan strategists say in a note. The 10-year yield falls 0.4 basis point to 4.831%, while the 20-year yield is down 0.2 bp at 5.285%, according to Tradeweb. (emese.bartha@wsj.com)

0546 GMT - The key questions for markets at the European Central Bank's Thursday meeting is whether the broadly anticipated 25-basis-point hike, following the first increase in June, marks the conclusion of a brief, precautionary tightening of monetary policy or the transition to a longer rising cycle, Royal London Asset Management's Wolfgang Bauer says in a note. "Important clues about the direction of policy may come from whether [President Christine] Lagarde emphasizes energy-driven headline inflation or the recent moderation in core and services inflation," the fund manager says. Rising long-end government bond yields, in particular, are already tightening financial conditions and doing much of the ECB's work, he says. "Unless inflationary pressures broaden materially, I would therefore find a longer, more aggressive hiking cycle difficult to justify." (emese.bartha@wsj.com)

0538 GMT - The European Central Bank is moving to recalibrate rates preemptively in the absence of a solution to reopen the Strait of Hormuz, Neuberger's Patrick Barbe says in a note. A rate hike on Thursday is justified by energy prices having reached levels embedded in the ECB's adverse scenario, the senior portfolio manager says. The ECB's view is that prolonged high energy prices make a certain degree of indirect inflation diffusion inevitable. For the time being, core inflation has stabilized in the wake of service inflation showing weak activity and high interest rates weighing on consumption and real estate, he adds. Money markets are pricing in a 95% probability of a 25-basis-point rate hike by the ECB, according to LSEG data. (emese.bartha@wsj.com)

0517 GMT - Higher yields now provide a substantially better income buffer than in recent years, while cash remains exposed to inflation and reinvestment risk, Julius Baer's Afonso Borges says in a note. A disorderly bond crisis is unlikely, according to Julius Baer. Within fixed income, Julius Baer favors high-quality investment-grade corporate bonds in the five-to-10-year segment, where carry and roll-down potential compensate investors without excessive exposure to a fiscal-driven rise in long-end term premia, the fixed income analyst says. Julius Baer complements this allocation with U.S. Treasury inflation protected securities and real assets as protection against a less orderly fiscal adjustment. (emese.bartha@wsj.com)

(END) Dow Jones Newswires

September 10, 2026 04:24 ET (08:24 GMT)