The latest Market Talks covering Financial Services. Exclusively on Dow Jones Newswires at 4:20 ET, 12:20 ET and 16:50 ET.

0703 GMT - The Bank of Japan's monetary policy is shifting from a stance of cautious normalization after years of ultra-loose policy, to a nimble, proactive response to data and market developments, HSBC's Frederic Neumann says in a note. The BOJ raised rates from early 2024 at a steady, monotonous pace, designed not to rattle markets after years of deflation, the chief Asia economist says. After raising its policy rate only in June, BOJ is expected to do so again later this week to 1.25%. BOJ officials could move yet again in the coming months, he says. As Japan leaves behind its deflation-plagued past, the Japanese yen has shown signs of stabilization and local yields are starting to look attractive, HSBC says. (kosaku.narioka@wsj.com; @kosakunarioka)

0657 GMT - The U.S. dollar rises as investors anticipate the Federal Reserve will increase interest rates on Wednesday amid elevated oil prices as the Middle East conflict worsens and strong U.S. inflation and jobs data. High oil prices exacerbate inflation concerns, causing yields to rise, additionally boosting the dollar as the U.S. is an oil exporter. "Monetary policy may not be well suited to offsetting the current supply shock, but there's a need to keep inflationary expectations dampened," says BNY's John Velis in a note. Money markets are pricing in a 93% chance of a Fed rate hike this week, LSEG data show. The DXY dollar index rises 0.3% to 99.683, having hit a one-month high of 99.736 on Monday. (jessica.fleetham@wsj.com)

0542 GMT - U.S. Treasury yields rise across maturities in Asian trade after the 10-year yield rose above 5% for the first time since October 2023 on Monday. Investors await the Federal Reserve's rate decision on Wednesday, with a 25bp hike priced in with a 93% probability, according to LSEG. "Logic would suggest that a rate hike should calm the back end," ING's rates strategists say in a note. "However, the back end is super flighty," they say. The two-year yield is up 4.4 bps at 4.676%, while the 10-year Treasury yield rises 6.2 bps to 5.021%, according to Tradeweb. (emese.bartha@wsj.com)

0509 GMT - Norway's upcoming 20-year bond syndication is expected to be dominated by domestic investors, Danske Bank's Jens Peter Sorensen says in a note. Norway is expected to issue 10 billion Norwegian kronor in the new bond which has a maturity date of September 2046, the chief analyst says. The new bond will lengthen the Norwegian government bond curve by four years, as the currently longest-dated bond has its expiry date in 2042. (emese.bartha@wsj.com)

0426 GMT - Faster price increases in India, driven by costs of food and oil and rising core inflation, strengthen the case for a shallow rate-hiking cycle, Nomura analysts Sonal Varma and Aurodeep Nandi say in a note. Consumer prices rose 4.8% on year in August from 4.5% in July, while core inflation accelerated to 4.2% from 3.9%. The bank now expects 50 bps of rate hikes in 4Q, with the Reserve Bank of India raising rates in October and December. Nomura has raised its fiscal 2027 inflation forecast to 5.1% from 4.6%, above the central bank's 5.0% projection.(venkat.pr@wsj.com)

0332 GMT - China's new-home market is showing tentative signs of stabilization, but not a broad recovery, says Yuhan Zhang, principal economist at The Conference Board's China Center. The latest data show divergence even among major markets, with the secondhand housing sector considerably weaker than the new-home segment. The gap is economically important, says Zhang. New-home prices are stabilizing selectively, aided by policy measures, developer pricing strategies and stronger projects in core cities. Resale prices--which respond more directly to demand and sellers' willingness to cut prices--show underlying market confidence remains subdued. "We see some signs of stabilization in a few high-demand markets like Shanghai, but the nationwide picture is still not buyers bidding prices higher." (fabiana.negrinochoa@wsj.com)

0310 GMT - China's economy continues to show diverging signals, as consumption and investment remain weak, while industrial production powers on, says Zhiwei Zhang at Pinpoint Asset Management. Data earlier showed expected weakness in retail sales--a gauge of consumption--alongside continued contraction in investing activity and solid growth in factory output. Unemployment edged higher, while the property sector's struggles persist. After the economy slowed in 2Q, Zhang says the market is waiting for fiscal policy to become more supportive in 3Q. But there is so far no clear sign of stronger fiscal spending yet, he adds. That leaves China's economy open to downside risks as it will take time for fiscal support to be implemented and transmitted. (fabiana.negrinochoa@wsj.com)

0302 GMT - Australian banks' recent underperformance relative to global peers shouldn't be seen as a buying opportunity, Macquarie analysts warn. They tell clients in a note that, since late 2024, global bank stocks have been catching up on ASX counterparts following a period of depressed valuations. However, Australia's premium has narrowed rather than disappeared, with its banks still trading at a 50% premium to global peers on a price-to-earnings basis. The MS analysts see limited scope for Australian banks to meaningfully improve revenues, leaving cost reduction as the most credible route through which they can lift returns. Without a sustained improvement in profitability, they anticipate further compression in Australian bank valuation multiples. (stuart.condie@wsj.com)

0224 GMT - Asian currencies mostly weaken in Asian trade, after the 10-year U.S. Treasury yield surged above 5% on Monday before settling at 4.960%. The rise in Treasury yield was driven by persistent inflation concerns, elevated oil prices, large government borrowing requirements, and heavy corporate issuance associated with artificial intelligence investment, Commerzbank Research analysts say in a note. The 5% level is psychologically and economically significant, they note, as sustained yields above the level would further tighten financial conditions. The U.S. dollar rises 0.3% to 154.82 yen and 0.45% higher at 1353.14 won, while the Australian dollar is 0.15% lower at US$0.7126, LSEG data show.(amanda.lee@wsj.com)

0221 GMT - Australian consumer spending rose 1.1% in August, which at face value looks healthy, but exclude rising fuel costs and the increase falls to a more moderate 0.6% rise, says CBA. Non-discretionary spending rose 2.2% in August driven by a sharp 12% rise in fuel outlays, the bank adds. Total discretionary spending growth slowed to 0.4%, it adds. The small increase follows a 12% in July. The data comes as Canberra is ruling out another short-term cut to fuel taxes to ease the burden of rising oil prices.(james.glynn@wsj.com; X @JamesGlynnWSJ)

1056 GMT - India's elevated August inflation data sets the scene for a rate hike in October, Shilan Shah of Capital Economics writes in a note. Further rises in inflation are expected, and the renewed surge in oil prices imply that the "risks are heavily stacked to the upside," Shah said. Fuel-price inflation held steady last month, but the renewed elevated energy prices due to the Middle East conflict leaves open the prospect of further pump price hikes, Shah adds. Excess banking liquidity and rising household inflation expectations also support the expectation that underlying inflation will rise over the coming months, Shah adds. CE expects a total of 75bps of hikes to the repo rate this cycle, taking it to 6.00% in the first half of 2027. (kimberley.kao@wsj.com)

0833 GMT - The upcoming Senate cloture vote is the crypto Clarity Act's most immediate obstacle, says Andrew Melville, head of research at institutional crypto derivatives data and analytics firm Block Scholes. The Sept. 15 vote can end the debate on the motion to proceed and begin the process of bringing the crypto bill for a final vote. Melville notes that the bill is also up against tight session timelines interrupted by the Midterm elections. The version being debated in the Senate also has significant revisions and must be reconciled with the version the House passed before President Trump can sign off on it. "If the measure is not enacted before the 119th Congress ends on 3 January 2027, it will expire and must be reintroduced in the new Congress."