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

0934 GMT - Goldman Sachs economists raise their forecast for U.K. first-quarter growth to 0.57% quarter-on-quarter, up from an earlier forecast of 0.22% growth, following stronger-than-expected GDP growth for February. U.K. monthly GDP expanded 0.5% in February, above the consensus forecast of 0.2% growth by economists in a WSJ survey. Economic growth is nonetheless expected to slow in the coming months due to the impact of higher energy prices, Goldman Sach's James Moberly says in a note. "We continue to expect a slowdown in the sequential growth pace through the rest of the year given the impact of the conflict in the Middle East," he says. (miriam.mukuru@wsj.com)

0924 GMT - China's economy continues to face some uncertainties despite a strong start to the year, UOB economist Ho Woei Chen says in a note. The country's first-quarter GDP growth of 5.0% exceeded market consensus and UOB's forecast. However, external headwinds are poised to strengthen if the Middle East conflict leads to prolonged supply disruptions and sustained higher oil prices, she writes. This has damped the global growth outlook and posed risks to Chinese exports, she adds. GDP growth could ease to around 4.6%-4.8% on year in the next three quarters, UOB says. (tracy.qu@wsj.com)

0923 GMT - U.K. GDP rose by a bumper 0.5% on month in February, but March's activity PMIs suggest the war in Iran has already all but extinguished growth, Capital Economics' Ruth Gregory says in a note. Encouragingly, some of the sectors most exposed to the leap in energy prices were performing well in February, she says. Energy-intensive sectors such as mining and quarrying, transport and storage, wholesale and retail, as well as arts and entertainment, posted strong gains. The better-than-expected February outturn probably meant that GDP grew by around 0.6% on quarter in the first quarter, rather than the 0.3% previously thought, Gregory says. "But the leap in energy prices means there is unlikely to be much growth after that," she says. (edward.frankl@wsj.com)

0921 GMT - Higher energy prices risk knock-on effects for wages, but this isn't the case yet, European Central Bank rate-setter Joachim Nagel tells CNBC on the sidelines of the IMF Spring meeting. Consumers learned to react quickly to higher prices after the energy shock of 2022. "This is the reason why I believe this question around the Strait of Hormuz is so important. Because... if the oil prices are not coming down further, then the probability is rising that we will see a similar reaction function." However, it remains too early to say we are there yet, Nagel says. "So I'm really cautious to give a proper indication (of) what is the next step we have to do on the monetary policy side," he says. (don.forbes@wsj.com)

0919 GMT - U.K. GDP data for February came in stronger-than-expected, showing that the economy was building momentum before the start of the Middle East conflict, Secure Trust Bank CEO Ian Corfield says in a note. Monthly GDP grew by 0.5% in February, higher than the 0.2% growth consensus forecast by economists a WSJ survey. "There are clear signs of underlying economic strength, but the external shocks facing the U.K. economy mean both consumers and businesses are likely to remain cautious," he says. (miriam.mukuru@wsj.com)

0901 GMT - The Iran war has boosted the performance of carry trades where investors borrow in a low interest-rate currencies to invest in ones with higher rates, Commerzbank's Michael Pfister says in a note. Investor bets on a weaker Japanese yen and Swiss franc have performed well along with bets on a stronger Australian dollar, Norwegian krone and sterling, he says. The Australian dollar and the Norwegian krone have strengthened as commodity exporters, while sterling has gained on markets pivoting towards expecting U.K. interest-rate rises, he says. The Swiss National Bank's threats about currency interventions have weakened the franc while rising oil prices have hit the yen. (renae.dyer@wsj.com)

0846 GMT - The euro looks vulnerable to a correction lower after its recent recovery against the dollar to levels before the Iran conflict, ING's Chris Turner says in a note. Hopes for a second round of U.S.-Iran peace talks and a possible extension to the cease-fire have lifted the euro. It is surprising how quickly the euro has risen back towards $1.18, Turner says. "We are not fans of chasing it higher from here and feel it could easily correct back to $1.1700 on any adverse news." The euro falls 0.1% to $1.1783 after reaching $1.1823 overnight, its highest level since Feb. 27, LSEG data show. (renae.dyer@wsj.com)

0842 GMT - Beijing is unlikely to cut the policy rate in the near term, according to UOB economist Ho Woei Chen in a research note. "With China's 1Q gross domestic product growth at the top of the official 4.5%-5.0% target, the likelihood of near-term rate cuts has diminished," the economist says. While UOB maintains its baseline forecast of a 10 bps cut to the policy interest rate, it pushes back the timing of the move to 3Q from 2Q, citing heightened uncertainties from developments in the Middle East. (tracy.qu@wsj.com)

0833 GMT - The September 2049 index-linked gilt due to be auctioned at 0900 GMT is likely to draw demand due to market optimism about the U.S.-Iran resolving the Middle East conflict, RBC Capital Markets strategists say in a note. Additionally, the auction marks the only long-dated gilt supply from the Debt Management Office in the April to June quarter, the strategists say. Nonetheless, the September 2049 index-linked gilt valuation has increased in recent weeks, leaving the index-linked gilt at expensive levels in relative-value terms, the strategists say. (miriam.mukuru@wsj.com)

0820 GMT - The U.K. smashed growth expectations in February, Sanjay Raja at Deutsche Bank says. GDP rose 0.5% during the month, above expectations for 0.2% growth. "Given today's data, spending looks stronger than anticipated. And firms may also be investing more than we thought heading into the Iran conflict," Raja says. Growth in the first quarter is likely to be more than double the rate than many economists expected, which should also lift full-year views. However, the February GDP print marks the calm before the storm of the Middle East war, he says. Households are already feeling the energy shock, hitting consumption. Business are also expected to crimp investment and hiring plans. Growth is therefore expected to be more sluggish in the second quarter and beyond, Raja says. (don.forbes@wsj.com)

0801 GMT - China's export growth will likely gradually recover ahead thanks to the competitive advantages of its manufacturing and technology sectors, says Marcella Chow, global market strategist at J.P. Morgan Asset Management. China's economy grew 5.0% in 1Q, thanks to strong exports and manufacturing activity, while domestic demand continues to lag, Chow says in an email. Exports rose 14.7% in the first quarter, led by products such as integrated circuits, computer equipment, automobiles and ships, she says. However, exports growth slowed sharply in March compared with first two months, likely due to high base from last year's front-loading activities, she adds.(jiahui.huang@wsj.com; @ivy_jiahuihuang)

0748 GMT - U.K. government bond yields fall as investors are optimistic about the prospects of the U.S. and Iran holding talks to end the Middle East conflict. "Markets generally continue to trade on optimism that the conflict will ultimately be sorted out in weeks," Deutsche Bank Research strategists say in a note. U.K. monthly GDP data for February was stronger than expected at 0.5%, higher than the consensus forecast of 0.2% growth by economists in a WSJ poll, although this was before the impact of the Middle East war. Ten-year gilt yields fall 1.2 basis point to last trade at 4.786%, Tradeweb data show. (miriam.mukuru@wsj.com)

(END) Dow Jones Newswires

April 16, 2026 05:34 ET (09:34 GMT)

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