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

1109 GMT - The Bank of England monetary policy committee members could signal a preference for an interest-rate increase in the coming months given rising oil prices, Barclays analysts say in a note. The U.S. struck Iranian targets over the weekend and Iran launched strikes on ships passing through the Strait of Hormuz. "We think the increased tensions in the Middle East and rise in oil prices this week will keep the risk of a further inflationary impulse forefront in the minds of MPC members," they say. Markets fully price in one quarter-point BOE rate increase in 2026, and a 28% chance of a second rate increase by year-end, LSEG data show. (miriam.mukuru@wsj.com)

1039 GMT - U.S. Treasury yields edge higher but retreat from highs earlier in the day while the dollar trades steady as markets absorb the prospect of a new phase of military escalation in the Middle East. "The week ahead now becomes critical because the market needs to know whether the oil shock is feeding into the inflation data or simply tightening financial conditions through sentiment," Tickmill Group's Patrick Munnelly says in a note. The two-year Treasury yield rises 1 basis points to 4.216%, having hit 4.239%, the highest level since February 2025, earlier in the day, according to Tradeweb data. The 10-year Treasury yield is up 0.2 basis points at 4.570%. The DXY dollar index is steady at 100.943, having earlier traded higher. (emese.bartha@wsj.com)

1002 GMT - The dollar could ease if data Tuesday show U.S. underlying inflation pressures remained subdued in June, MUFG Bank's Lee Hardman says in a note. Market participants will be watching closely for signs of second-round effects from higher energy prices feeding into underlying inflation, he says. So far, core inflation has increased only modestly since the onset of the U.S.-Iran conflict, he says. "Another benign core reading, alongside easing energy inflation, would likely encourage market participants to pare back expectations for further Federal Reserve rate hikes, putting a dampener on dollar strength in the week ahead." The DXY dollar index trades flat at 100.911. (renae.dyer@wsj.com)

0943 GMT - U.K. government bond yields, or gilt yields, are at risk of rising due to political uncertainty, Barclays' analysts say in a note. The U.K. faces political risk as the country awaits a new prime minister after Keir Starmer stepped down in June. Andy Burnham is widely expected to succeed Starmer on July 20 if no Labour party candidate challenges him for the position. The U.K.'s poor public finances could present a challenge for the new prime minister, the analysts say. Bond yields rise globally due to increased Middle East tensions, though U.K. gilt yields rise by more than their eurozone counterparts. Ten-year gilt yields rise 2.2 basis points to 4.904%, Tradeweb data show. (miriam.mukuru@wsj.com)

0915 GMT - The Indonesian government's efforts to centralize management and curb tax leakages in the resources and mineral sectors are expected to gradually boost state revenue and export earnings if policy implementation improves, S&P Global Ratings says in a note. Indonesia's weaker fiscal and external positions, caused by high energy prices, higher interest rates, a weaker rupiah, policy uncertainty and rising debt, are temporary and should improve with higher commodity prices and government spending cuts, it says. S&P affirms Indonesia's BBB long-term sovereign credit rating, and expects the government to keep its fiscal deficit below the legal ceiling of 3% of GDP. It expects Indonesia's economy to grow 5.1% this year despite robust 5.6% growth in 1Q, due to continued external uncertainties and higher domestic interest rates. (yingxian.wong@wsj.com)

0908 GMT - The Polish zloty could underperform its central European peers as the region comes under pressure from risk aversion due to renewed U.S.-Iran conflict, ING's Frantisek Taborsky says in a note. National Bank of Poland Governor Adam Glapinski said a future rate cut was possible during a press conference last Thursday. This could weigh on the zloty for a "bit longer" as data on Wednesday should confirm inflation eased to 2.5% in June, Taborsky says. In contrast, the Czech central bank raised rates in June and Hungary's domestic backdrop has improved, supporting the outlook for these currencies, he says. The euro rises 0.2% to 4.3275 zloty, having reached a 19-month high of 4.3502 on Friday, LSEG data show. (renae.dyer@wsj.com)

0852 GMT - Yields on U.K. 30-year government bonds rise as higher oil prices push up inflation risks. The prospect of elevated inflation raises concerns about the impact on the economy, as well as the possibility of interest-rate rises by the Bank of England. The price of a barrel of Brent crude climbs 2.6% to $77.98 following U.S. attacks on Iranian targets and Iran's strikes on commercial vessels on the Strait of Hormuz. U.K. 30-year gilt yields rise 2.7 basis points to last trade at 5.637%, Tradeweb data show. (miriam.mukuru@wsj.com)

0851 GMT - The cost of default protection for euro credit rises due to worsening market sentiment as the U.S.-Iran conflict intensifies. Over the weekend, the U.S. launched airstrikes on Iran's military targets while Iran struck vessels passing through the Strait of Hormuz. The iTraxx Europe Crossover index of euro high-yield credit default swaps rises 2 basis points to 248bps, S&P Global Market Intelligence data show. (miriam.mukuru@wsj.com)

0841 GMT - The evolution of the U.S.-Iran conflict is likely to be the key factor driving all major asset classes and investor sentiment this week, analysts at First Abu Dhabi Bank say in a note. Military tensions between the U.S. and Iran escalated during the weekend. Focus will be on whether the situation stabilizes or whether it escalates further, they say. "Renewed hostilities between both sides over the weekend have been a worrying development--one that will likely weigh heavily on regional investor sentiment as well as impact negatively on a global macro scale," the analysts say. (emese.bartha@wsj.com)

0834 GMT - The Philippines' core inflation has yet to peak, Nomura economists say in a note. They point to core inflation having continued accelerating to 4.4% last month from 4.1% in May, due to continuing pass-through effects from energy prices. Meanwhile, headline inflation is expected to have already peaked, having eased to 6.4% in June from 6.8% in May, driven by lower retail fuel prices. Nomura lowers headline inflation forecasts for the Philippines to 5.1% from 5.5% for 2026 and to 3.1% from 3.2% for 2027. (amanda.lee@wsj.com)

0818 GMT - Gold prices might face some short-term pressure, according to GivTrade's Waleed Said. The yellow metal is falling as expectations for tighter interest rates are outweighing the safe-haven trade, the analyst says. "Higher oil prices are lifting Treasury yields and the dollar, making non-yielding gold less attractive," the analyst says. Rising tensions between the U.S. and Iran may still provide support for the precious metal's price, he adds. Spot gold is down 1.3% at $4,068.15 an ounce. (tracy.qu@wsj.com)

0812 GMT - Markets increase their bets of the Bank of England increasing interest rates in the coming months as the U.S.-Iran conflict intensifies. The U.S. attacked Iran's military targets over the weekend and Iran responded with strikes on ships passing through the Strait of Hormuz. The renewed attacks have caused oil prices to rise and brought back inflation fears. Investors currently price in a total of 34 basis points of BOE rate rises in 2026, seven basis points up from last week's expectations, LSEG data show. (miriam.mukuru@wsj.com)

(END) Dow Jones Newswires

July 13, 2026 07:09 ET (11:09 GMT)

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