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

1001 ET - U.S. pending home sales rose 1.3% from a week earlier to their highest level since the first half of May during the four weeks ending July 5, Redfin says. Homebuying demand picked up partly because of temporarily declining mortgage rates. The weekly average rate dipped to 6.43% on July 2, its lowest level in six weeks. That pushed the median monthly housing payment down to $2,598, also its lowest level in six weeks. But rates bounced back, with the daily average rising to 6.68% on July 8. Home-sale prices remain stubbornly high: The median sale price rose 2.2% year over year to $408,808, just about $500 shy of the all-time high. On the listing side, new listings fell 2.5% week-over-week to their lowest level since January. (chris.wack@wsj.com)

1000 ET - An interest rate hike by the ECB in July isn't off the table, Carsten Brzeski at ING says in a note. "Until earlier this week, we would have argued that lower energy prices had taken the rate hike option entirely off the table for the ECB's July meeting--but some members might feel tempted to use the latest resurgence in higher energy prices as a reason to get things done as quickly as possible," he says. Surprisingly low inflation in June and a drop in oil prices could have caused some officials to question the need for further tightening. "However, the recent rebound in oil prices amid renewed Middle East tensions serves as a reminder that the inflation outlook remains far from settled," Brzeski says. (don.forbes@wsj.com)

0909 ET - Canada's neutral interest rate might be a half-point lower than current Bank of Canada estimates, says economist David Watt at Rosenberg Research. Economists say the neutral rate is the level that neither stimulates nor subtracts from growth, and the BOC estimates that in Canada it sits between 2.25% to 3.25%. Watt says a population decline, two decades of flat growth in capital stock, and lingering US trade-policy uncertainty have pulled Canada's estimate for the neutral rate down by roughly 50 basis points, to between 1.75% and 2.75%. As a result, Watt says, the BOC's main interest rate is likely too high at 2.25%, and a rate increase to guard against inflation risks from higher oil prices would be an error. (Paul.Vieira@wsj.com; @paulvieira)

0857 ET - The euro could underperform other European currencies as the growth outlook has weakened, Societe Generale's Kit Juckes says in a note. Elevated oil prices are encouraging markets to bet on the European Central Bank to raise interest rates further this year despite consensus growth forecasts having fallen, he says. "I'll stick to the view that by the end of the year, the growth outlook will be playing a bigger role in determining both inflation and ECB policy." Short positions betting on a weaker euro versus the Swedish krona and Norwegian krone "make sense," he says. The euro falls 0.1% to 11.1288 Norwegian krone but trades flat versus the Swedish krona at 11.0630. (renae.dyer@wsj.com)

0855 ET - Treasury yields are little changed following President Trump's comments yesterday that Iran called him seeking a deal. Oil prices are also stable after Wednesday's rally triggered by the end of the U.S.-Iran ceasefire. Weekly jobless claims slip to 215,000 from an upwardly revised 217,000, compared with WSJ consensus forecast of 218,000. June existing home sales, due at 10 a.m. ET, are expected to cool down. The WSJ Dollar Index slips 0.1%. The 10-year yield is at 4.577%, after settling yesterday at 4.567%. The two-year declines to 4.189% from 4.200%. (paulo.trevisani@wsj.com; @ptrevisani)

0854 ET - Renewed tensions in between the U.S. and Iran could drive up inflationary pressures and keep gilt yields elevated, Validus Risk Management's Harry Woolman says in a note. This could worsen U.K. debt affordability. "Higher inflation expectations are likely to keep rates elevated, ensuring debt-servicing costs remain structurally higher than they were before the pandemic," he says. U.K. government finances are stretched due to high borrowing costs and weak economic growth. Ten-year gilt yields fall 2.6 basis points to 4.940%, having hit a seven-week high of 4.980% on Wednesday, Tradeweb data show. (miriam.mukuru@wsj.com)

0741 ET - Sterling's outlook depends on whether potential U.K. prime minister in-waiting Andy Burnham delivers on his promise to stick to the fiscal rules, Ebury's Matthew Ryan says in a note. "If Burnham is a man of his word, then sterling may well be fine," he says. Any indication that these rules are being abandoned or bent, even at the margins, risks a disorderly selloff in U.K. assets, he says. Markets will have more information if Burnham's leadership is confirmed around July 17, he says. The euro rises 0.1% to 0.8533 pounds, having earlier reached a one-year low of 0.8516 pounds, according to LSEG. Sterling is flat at $1.3385 after hitting a three-week high of $1.3430 earlier. (renae.dyer@wsj.com)

0724 ET - U.K. assets could experience increased volatility in the coming months due to uncertainty around the government spending and revenue plans, Validus Risk Management's Harry Woolman says in a note. U.K.'s constrained public finances make it difficult for the incoming government to maintain fiscal prudence given the rising spending pressures, Woolman says. "Without a sustained improvement in growth, difficult choices between higher taxes, lower spending, or higher borrowing will become increasingly difficult to avoid." (miriam.mukuru@wsj.com)

0713 ET - The euro could trade steady against the dollar in the coming months even if the European Central Bank raises interest rates again, Rabobank's Jane Foley says in a note. The market is already fully priced for another ECB rate rise in September so this is unlikely to offer much support to the euro, she says. Moreover, Germany's economy continues to face headwinds even after Chancellor Friedrich Merz announced a package of reforms. However, rate rise expectations for the Federal Reserve look overdone despite a resilient U.S. economy, she says. "We expect sideways trading in euro-dollar on a three-month view and a modest upward bias to emerge in the currency pair on a three-to-six-month view." The euro rises 0.1% to $1.1422. (renae.dyer@wsj.com)

0656 ET - Appetite for bonds has increased in 2026 as investors move funds into fixed income assets after years of solid performance in stock markets, Federated Hermes' R.J. Gallo says in a note. Strong U.S. corporate earnings and resilient economic growth have boosted demand for U.S. corporate bonds. Demand for U.S. municipal bonds was also strong in the second quarter of 2026, causing municipal bond yields to fall while U.S. government bond yields increased, he says. (miriam.mukuru@wsj.com)

0653 ET - PepsiCo has been working to improve sales by cutting prices across its snacks business to bring back inflation-weary customers and restaging several of its largest brands to lean into current trends. The company saw both its convenient foods and beverage businesses perform well in North America during the recent quarter, CEO Ramon Laguarta says. However, overall results were tempered, "as U.S. food and beverage category performance moderated with consumer budgets tightening due to rising inflationary pressures." (connor.hart@wsj.com)

0619 ET - The Bank of Canada is likely to leave interest rates on holdindefinitely as policymakers try to support a struggling economy before conditions normalize late this decade, according to a forecast from Canadian think-tank Signal49. The independent forecasting group expects Canada's GDP will grow a meager 0.5% this year, as the country deals with little-to-no population growth and uncertainty over U.S. trade policy. Higher energy prices and low consumer confidence will limit growth in consumer spending, Signal49 says. Excluding infrastructure and defense, government spending will be limited, the group adds. "Broader weakness in Canada's economy should give comfort to the Bank of Canada that the inflation will be temporary," says Signal49. Its forecast period runs until 2030. (paul.vieira@wsj.com, @paulvieira)

(END) Dow Jones Newswires

July 09, 2026 10:01 ET (14:01 GMT)

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