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

0901 ET - Odds of an interest rate increase by the Fed this month are down to 17% on the CME's FedWatch tool, after softer-than-expected June inflation. That compares to 42% yesterday. June CPI shows a 0.4% monthly decline and a 12-month 3.5% increase, indicating that prices were softer than economists forecast. Even without last month's sharp decline in oil prices, the inflation figures were better than expected. "This data exceeded our expectations and significantly reduces, if not negates, the chances of a rate hike this month," Spartan's Peter Cardillo writes. Markets mostly price at least one hike by year end, according to FedWatch. (paulo.trevisani@wsj.com; @ptrevisani)

0859 ET - Yields on U.K. government bonds, or gilts, trim their rise following weaker-than-expected U.S. inflation data for June although they remain higher on the day. Annual U.S. headline inflation stood at 3.5% in June, below the 3.8% consensus forecast by economists in a WSJ survey. Monthly headline inflation slowed to minus 0.4%, weaker than the consensus forecast of minus 0.2%. Ten-year gilt yields last trade at 4.994%, down from 5.003% prior to the data release and below an earlier eight-week high of 5.047%, Tradeweb data show. (miriam.mukuru@wsj.com)

0851 ET - Eurozone government bond yields trim their rise after below-forecast U.S. inflation data for June. Yields retreat from eight-week highs reached earlier following military escalation in the Middle East which lifted oil prices sharply. Headline annual CPI inflation was 3.5% in June, below expectations of 3.8% in The Wall Street Journal's poll. Core CPI came was 2.6%, decelerating from 2.9% in May and below analyst expectations of 2.9%. "This is a major downside CPI surprise," says Monaxa chief dealer Petros Pantzari in a note. The 10-year Bund yield trades at 3.084%, still up 1 basis point on the day but below its earlier eight-week high of 3.112%, according to Tradeweb. (emese.bartha@wsj.com)

0849 ET - The euro rises to an 11-day high against the dollar after lower-than-expected U.S. inflation data. Both headline and core measures of inflation eased more than forecast, reducing expectations for the Federal Reserve to raise interest rates. This fuels the recent shift in U.S.-eurozone rate differentials in the euro's favor as markets bet on the European Central Bank delivering further rate rises this year. The euro rises to a high of $1.1462 after the data, from $1.1413 beforehand. (renae.dyer@wsj.com)

0844 ET - Treasury yields and the dollar fall as U.S. inflation slows more than expected amid renewed tensions in the Middle East. June CPI declines 0.4%, after rising 0.5% in May and reflecting last month's sharp fall in oil prices. Without energy and food items, prices were stable. In 12 months, headline inflation was 3.5% and core was 2.6%, in both cases slowing from May. All readings are below WSJ consensus. The numbers ease pressure on the Fed to raise interest rates, although oil is rising again. The WSJ Dollar Index falls 0.5%. The 10-year yield is at 4.561%, down from 4.610% yesterday. The two-year falls to 4.193% from 4.261%. (paulo.trevisani@wsj.com; @ptrevisani)

0814 ET - Barring a big surprise, the European Central Bank will hold its key interest rate next week, though a hike in September isn't a done deal, HSBC's Simon Wells says in a note. Some have argued a single rate rise in June runs the risk of looking like a 2011-style mistake, when the ECB hiked twice but swiftly reversed, he says. "We don't buy it," Wells notes. Oil futures prices now suggest inflation could undershoot the 2% target in 2028. While the July press conference is likely to keep the door open, there won't likely be a strong signal, and come September the case for hiking could be weaker, he says. "We think rates could be on hold this year." (edward.frankl@wsj.com)

0806 ET - Yields on U.K. government bonds, or gilts, are expected to remain above other developed market equivalents due to inflation and fiscal concerns, Handelsbanken's Daniel Mahoney says in a note. Gilt yields have risen at a faster pace than their U.S., eurozone and Japanese peers since tensions between the U.S. and Iran heated up over the weekend. This reflects investors' concerns about the nation's vulnerability to geopolitical risks, the persistence of high U.K. inflation and the reliance on overseas buyers for gilts, Mahoney says. Ten-year gilt yields are up 4.4 basis points to last trade at 5.007%, Tradeweb data show. Ten-year Bund yields climb 2.5 basis points to last trade at 3.099%. (miriam.mukuru@wsj.com)

0733 ET - JPMorgan's Jamie Dimon warns that strength in the U.S. economy right now could be undercut by "meaningful disruptions" that are already starting to boil up. The economy has been boosted this year by strong business investment and hiring, and has support from tailwinds like AI-driven capital investment and fiscal stimulus, Dimon says in his bank's 2Q report. But geopolitical tensions, sticky inflation, large global fiscal deficits and elevated asset prices are "shifting below the surface like tectonic plates," the CEO says. "They may remain manageable, but they could also cause meaningful disruptions when they shift or collide," he says. The bank is monitoring those risks and preparing to adjust of conditions change, Dimon says. (dean.seal@wsj.com)

0724 ET - Bitcoin rises slightly as the dollar eases ahead of U.S. inflation data and Federal Reserve Chair Kevin Warsh's testimony before lawmakers. "Perhaps dollar traders wanted to liquidate some of their long positions ahead of today's U.S. CPI data that could well impact expectations about the Fed's course of action," XM analyst Charalampos Pissouros says in a note. Inflation potentially cooled in June but any remarks from Warsh about not tolerating price pressures could boost the dollar by increasing the chance of a rate rise later this month as renewed U.S.-Iran tensions lift oil prices, he says. Bitcoin rises 0.9% to $62,681, LSEG data show. The inflation data are due at 1230 GMT followed by Warsh's testimony at 1400 GMT. (renae.dyer@wsj.com)

0710 ET - Investors could be reluctant to bet on a stronger euro even though the dollar appears to have lost upward momentum, Rabobank's Jane Foley says in a note. Optimism over German fiscal stimulus boosted the euro last year. Much of this enthusiasm has now faded on concerns that funds meant for infrastructure investment are being used to plug holes in budgets and downward revisions to growth following a surge in energy prices due to the Iran war, she says. While the European Central Bank is expected to raise interest rates again this year, this is already in the price, she says. "On balance, we expect choppy ranges to dominate euro-dollar into the autumn." The euro rises 0.1% to $1.1389. (renae.dyer@wsj.com)

0654 ET - The dry, warm weather this summer is expected to boost the U.K. retail industry, Shore Capital's Clive Black says in a note. Sales of "seasonal grocery, clothing, sunscreen, and cooling items like fans" is expected to climb, supporting the retail sector, he says. In addition, England's progress to the semi-finals of the World Cup is projected to drive up retail sales, Black says. U.K. consumers are likely to buy more grocery, food and beverages, and sports apparel due to the football celebrations, he says. (miriam.mukuru@wsj.com)

0651 ET - Investors need to alert to whether a rising default rate in private credit could cause systemic risk to rise in the economy, potentially sparking recession and a rise in default rates for all asset classes, Mediolanum International Funds Limited's Martin Reeves says in a note. Reeves doesn't expect this risk to materialize, however. "Unless we hit a material downturn, then the rise in default rates within private credit will likely be contained to within that sector," the head of high yield fixed income says. Though this will cause pain for some investors in alternative asset classes and on a few insurance company balance sheets. (emese.bartha@wsj.com)

(END) Dow Jones Newswires

July 14, 2026 09:01 ET (13:01 GMT)

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