Global Forex and Fixed Income Roundup: Market Talk

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

0635 GMT - The dollar falls as oil prices decline and demand for safe havens wane following a pause in strikes between the U.S. and Iran over the weekend. President Trump has put off a major escalation in military action against Iran as he attempts to revive diplomacy, The Wall Street Journal reports, citing U.S. officials. The drop in oil prices prompts markets to slightly trim expectations for U.S. interest-rate rises ahead of the Federal Reserve's policy decision on Wednesday. The DXY dollar index falls 0.3% to 101.155. (renae.dyer@wsj.com)

0625 GMT - Eurozone government bond yields fall at opening trade, tracking U.S. Treasury yields. Bond yields fall alongside a significant retreat in oil prices, as U.S. President Trump stepped back from a military escalation against Iran, prioritizing diplomatic solutions to reopen the Strait of Hormuz. Eurozone government bond supply will come from Belgium, which will auction 2.4 billion euros to 2.8 billion euros in 2031-, 2033- and 2035-dated bonds on Monday. The 10-year Bund yield falls 3.5 basis points to 3.134%, according to LSEG. (emese.bartha@wsj.com)

0601 GMT - There are chances for German Bunds to stabilize further, Commerzbank's Rainer Guntermann says in a note. The 10-year Bund yield faces upside resistance at year-to-date highs around 3.21%, while a rate hike by the European Central Bank in September is almost fully priced, the rates strategist says. The 10-year Bund yield closed at 3.173% on Friday, according to LSEG data. (emese.bartha@wsj.com)

0558 GMT - Without new projections or forward guidance from Federal Reserve Chairman Kevin Warsh at the coming meeting on Wednesday, the focus will be on the vote split, Danske Bank's Joel Rossier says in a note. "We think the most likely outcome is 2-4 votes in favor of a hike, which will not be enough for a hike," the senior analyst says. Danske forecasts 25-basis-point hikes in December and March, with risks skewed toward an earlier start. The Federal Reserve is expected to keep interest rates on hold at this week's meeting, even as money markets price in approximately 8 basis points of rate hike, implying an around 31.5% probability of tightening, according to LSEG. (emese.bartha@wsj.com)

0546 GMT - The Monetary Authority of Singapore's move to steepen the slope of its policy band "very slightly" could be viewed as dovish, says UOB's Jester Koh in a note. The central bank steepened the slope "very slightly", which Koh estimates to be a 25bp adjustment instead of an outright 50bp one. This move likely signals some degree of caution to avoid an excessively-strong Singapore dollar nominal effective exchange rate, he says. While the MAS could opt for a further 25bps adjustment in October or January if energy prices remain elevated for longer, UOB expects the central bank to retain its current policy band settings for the rest of 2026 and 2027. The MAS uses the exchange rate as a policy tool for maintaining price stability.(megan.cheah@wsj.com)

0544 GMT - The Federal Reserve is expected to keep the fed funds rate stable at this week's meeting, and the impact of the decision will hinge heavily on how Chairman Kevin Warsh frames the decision and path ahead, Goldman Sachs analysts say in a note. The relative stability in the long end of the Treasury curve and contained inflation risk premia are vulnerable to an on-hold decision that is accompanied by limited guidance on the outlook or reaction function, the analysts say. Money markets currently price in a 31.5% probability of a rate hike this week, while the majority of the market anticipates unchanged rates. (emese.bartha@wsj.com)

0536 GMT - Malaysia's tariff outlook could remain uncertain as the U.S. continues its excess-capacity investigation, CIMB economists Chew Khai Yen and Michelle Chia say in a note. They expect the probe to result in additional Section 301 tariffs, potentially lifting Malaysia's headline tariff rate back toward the 15%-19% level originally proposed under the U.S. reciprocal tariff plan. The newly effective 10% Section 301 forced-labor tariff has had little impact, as broad exemptions reduced the share of Malaysian exports to the U.S. subject to the levy to 31.9% from 33.0%, lowering the trade-weighted effective tariff to 5.1% from 5.2%, they add. (yingxian.wong@wsj.com)

0532 GMT - Investors are likely to focus on the number of potential dissenting votes at the Federal Reserve's interest-rate decision on Wednesday, LBBW's Elmar Voelker says in a note. "We believe it is possible that there could be up to three dissenting votes, given that a bloc of this size had already voted against the Fed's then 'dovish' forward guidance back in April," the senior fixed income analyst says. A unanimous decision in favor of a wait-and-see monetary policy stance at the Fed would be a bond-positive surprise, as it would shake market participants' current belief that a hike in September is practically a foregone conclusion, he says. (emese.bartha@wsj.com)

0522 GMT - Investors can be very confident that Federal Reserve Chairman Kevin Warsh will want to sound hawkish and do everything he can to bolster his inflation-fighting credentials, without actually doing anything just yet, BlueBay CIO Mark Dowding says in a note. "This could prompt some further flattening of the U.S. yield curve for the time being," he says. However, with the U.S. fiscal position continuing to deteriorate and the bill for Trump's Middle East war continuing to rise, ultimately this can be a factor which may see the curve re-steepen at a later point in time, Dowding says. (emese.bartha@wsj.com)

0520 GMT - U.S. Treasury yields fall while oil prices slide in Asian trade, as President Trump has put off a major escalation of his military campaign against Iran amid efforts to revive diplomacy to open the Strait of Hormuz. Treasury yields fall across maturities, reflecting lower oil prices, while investors also await the Federal Reserve's interest-rate decision on Wednesday. Brent oil falls 4.8% to $92.14 a barrel. The two-year yield declines 3.7 basis points to 4.292%, the 10-year yield is down 4.9 basis points at 4.629% and the 30-year yield declines 4.4 basis points to 5.117%, according to Tradeweb. (emese.bartha@wsj.com)

0516 GMT - The Monetary Authority of Singapore could steepen the slope of its policy band "very slightly" in its October statement, say BofA Securities strategists in a note.The central bank surprised by steepening the slope "very slightly" in July, with the choice of words seeming unprecedented to the strategists. The latest move--estimated to be a 25bp change rather than the conventional 50bp adjustment--suggests a policy preference towards greater flexibility amid an uncertain external backdrop, they say. The MAS likely views the current policy stance as moderately tight, as the move raises the degree of policy restrictiveness by a small margin, the strategists say. The central bank uses the exchange rate as a policy tool for maintaining price stability, given the city-state's small and open economy.(megan.cheah@wsj.com)

(END) Dow Jones Newswires

July 27, 2026 02:35 ET (06:35 GMT)