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

0941 GMT - High yields on U.K. government bonds, or gilts, could help limit any sterling falls, ING's Chris Turner says. Gilt yields surged and sterling fell Tuesday as pressure mounted on Prime Minister Keir Starmer to resign. The prospect of loose fiscal policy under any new leader is negative for gilts and sterling. However, short-dated yields have more influence on sterling, Turner says. These are driven higher largely by expectations for U.K. interest-rate increases due to inflation risks, which are positive for sterling and help offset political risks, he says. "High yields are probably providing sterling with a little insulation." The euro falls 0.1% to 0.8660 pounds, having hit a near three-week high of 0.8697 Tuesday, LSEG data show. (miriam.mukuru@wsj.com)

0939 GMT - U.S. Treasury yields decline as oil prices move lower, stabilizing after Tuesday's rise following a higher-than-expected U.S. April inflation print. Meanwhile, the dollar rises slightly due to safe-haven demand amid continued uncertainty in the Middle East and as the inflation data "reinforced expectations that the Federal Reserve will maintain a cautious stance over monetary policy," says DHF Capital S.A's Bas Kooijman. The 10-year Treasury yield falls 0.8 basis points to 4.463%, according to Tradeweb. The DXY dollar index rises 0.3% to 98.570. (emese.bartha@wsj.com)

0907 GMT - Yields on U.K. government bonds edge lower on Wednesday, pulling away from Tuesday's multi-year highs after U.K. Prime Minister Keir Starmer vowed to stay on. However, yields are still at elevated levels as political jitters and concerns about inflation remain, Hargreaves Lansdown's Matt Britzman says in a note. "The worry is that pressure on Prime Minister Keir Starmer could eventually lead to looser fiscal policy," Britzman says. In addition, high energy prices caused by the Middle East conflict "are feeding expectations that the Bank of England may have to raise interest rates this year," he says. Ten-year gilt yields fall 1.6 basis point to 5.078%, having reached 5.135% on Tuesday, the highest level since 2008, Tradeweb data show. (miriam.mukuru@wsj.com)

0832 GMT - India's consumption curbs have begun with a duty increase on gold, silver and platinum imports. As external accounts face mounting pressure amid the prolonged Middle East conflict, India's dusting off a playbook used before to arrest non-essential demand, Barclays economists say. Surging gold prices and intermittently high volumes have significantly increased the country's import bill, but tariffs aren't going to make much of a difference. The move may dampen volume demand, but high international gold prices will likely outweigh that. Barclays expects the country's gold import bill to rise further in FY 2027 from FY 2026, offsetting the volume decline. It estimates a 6 bps bump in May CPI inflation, and a 10 bps boost to June's. (fabiana.negrinochoa@wsj.com)

0821 GMT - The recent appreciation of the Australian dollar and Norwegian krone is being helped by investors seeking higher yields in a low volatility environment, ING's Chris Turner says in a note. "Despite the unresolved crisis in the Middle East and inflation spreading around the globe, foreign exchange markets remain very relaxed." Low volatility supports demand for carry trades where investors borrow in low interest-rate currencies to invest in ones with higher rates such as the krone and Australian dollar. The euro falls 0.1% to 10.7628 krone after hitting a three-year low of 10.7312 Tuesday, LSEG data show The Australian dollar falls 0.1% to $0.7235 but remains close to the near four-year high of $0.7277 reached May 6. (renae.dyer@wsj.com)

0806 GMT - The Bank of Thailand could move to tighten its monetary policy if inflation comes in above target, ANZ Research's Kausani Basak and Sanjay Mathur say in a note. Headline inflation is expected to average 3.60% on year in 2Q, exceeding the upper range of the BOT's 1%-3% target. Although the central bank could look through the country's near-term inflation spike, breaching the higher end of its target would likely warrant policy action to anchor inflation expectations. ANZ expects BOT to begin hiking rates in August, delivering two consecutive 25bp hikes and taking the policy rate to 1.50% by October from the current 1.00%. (amanda.lee@wsj.com)

0802 GMT - India's government is likely to follow up its gold and silver tariff hikes with more moves to reduce precious metal imports, Nomura analysts say. The tariffs follow Prime Minister Narendra Modi's appeal to citizens to conserve foreign exchange and avoid purchasing gold and jewelry. With India's balance-of-payments deficit tracking at over $70 billion, Nomura sees the tariffs as aimed at reducing imports of precious metals and narrowing the current-account deficit. Nomura estimates that imports of precious metals--including platinum--have risen sharply to 2.7% of GDP. Modi's appeal suggestsreduced policy appetite for a further deepening of the twin deficits. Next steps could include disincentivizing other nonessential imports like electronics; a diaspora bond to mobilize FX deposits; or fuel-price increases to reduce the fiscal burden. (fabiana.negrinochoa@wsj.com)

0754 GMT - The war in Iran may be helping China's economic growth, Capital Economics' Julian Evans-Pritchard says in a note. China's economy is stronger now than at the start of the year, supported by AI-related investments and electronics exports, the head of China economics says. He expects the two forces driving China's exports surge--soaring global demand for AI hardware and green technology--to persist, especially as energy supplies and prices take time to normalize. He says a resolution to the Iran war that allows a partial recovery of oil flows without sharply lowering energy prices is the goldilocks outcome for China. CE forecasts growth measured by its own China activity proxy at 3.5%, while official annual GDP growth should stay at 5.0%. (jason.chau@wsj.com)

0751 GMT - Improving working conditions for female, older and foreign workers could help boost Japanese economic growth, the OECD says in its latest report. Boosting the flexibility of regular employment contracts would help break down labor market dualism, as a large number of women and the elderly still work in non-regular employment, the OECD says. "Policies to attract and integrate foreign workers, as well as to guide them through employment schemes, would help better utilize foreign talents," it adds. (megumi.fujikawa@wsj.com)

0744 GMT - Bitcoin rises only slightly as the market balances regulatory optimism against ongoing U.S.-Iran tensions, Zaye Capital Markets analyst Naeem Aslam says in a note. "We see bitcoin's current setup as a liquidity-driven market, where inflation data, Treasury yields, the U.S. dollar, geopolitical risk, and regulatory headlines all matter at the same time." There are expectations for a clearer U.S. regulatory framework for digital assets but a stalemate between the U.S. and Iran continues, keeping investors cautious over risky assets. U.S. inflation data for April exceeded expectations Tuesday. Sticky inflation strengthen the case for scarce digital assets but also weighs on sentiment by reducing the prospect of interest-rate cuts, he says. Bitcoin rises 0.3% to $80,881, according to LSEG. (renae.dyer@wsj.com)

0737 GMT - The Philippine central bank could raise its policy rate to 6.00% from 4.50% by end-2026, says HSBC's Aris Dacanay in a note. Growth has stumbled in recent months from a decline in public capital expenditures. The easiest way to restore economic growth is to ensure that fiscal policy is back on track, he says. "Policymakers can do this by fast-tracking infrastructure projects that have already broken ground and have passed the stage of scrutiny," he adds. Monetary policy is also better equipped to tackle the spillover effects of higher energy and food prices on inflation expectations, he says. HSBC expects the BSP to hike its policy rate to 5.00%, 5.50% and 6.00% by 2Q, 3Q and 4Q, respectively. (amanda.lee@wsj.com)

0727 GMT - Yields on U.K. government bonds fall, reversing Tuesday's sharp rises, as Prime Minister Keir Starmer vows to stay on as U.K. leader. So far, potential challengers to Starmer have yet to formally declare themselves, easing fears about a leadership change in the near term. Gilt yields climbed to multi-decade highs on Tuesday as investors worried that a change in U.K. leadership could open the door for higher fiscal spending and possibly more government debt. Ten-year gilt yields fall 3.7 basis points to 5.057%, Tradeweb data show. (miriam.mukuru@wsj.com)

(END) Dow Jones Newswires

May 13, 2026 05:41 ET (09:41 GMT)

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