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.

0546 GMT - U.S. Treasury yields edge lower in Asian trade but continue to hover around new multiyear highs reached Tuesday as investor attention turns to a widely anticipated 25-basis-point interest-rate hike by the Federal Reserve later in the day. In particular, investors are focusing on signals on how the Fed seeks to return inflation to target. The recent rise in Treasury yields "reflect not only higher inflation expectations but also higher real yields driven by increased government borrowing and ongoing policy uncertainty," TwentyFour Asset Management portfolio manager Felipe Villarroel says in a note. The 10-year Treasury yield eases 0.2 basis point to 4.993%, according to Tradeweb, after hitting 5.041%, the highest since 2007, on Tuesday. (emese.bartha@wsj.com)

0540 GMT - Singapore's non-oil domestic exports likely rose 35% on year in August, accelerating from July's 24.2%, according to the median estimate of seven economists polled by The Wall Street Journal. July's strong performance was heavily supported by unprecedented electronics export growth on strong global artificial intelligence-related demand, OCBC Group Research analysts say in a report. This AI-driven boom is expected to have continued in August, they add. Enterprise Singapore expects 2026 NODX growth of between 14.0% and 16.0%. The data are due Thursday.(amanda.lee@wsj.com)

0537 GMT - The Federal Reserve faces a difficult balancing act, says TwentyFour Asset Management's Felipe Villarroel in a note. "While inflation remains above target and recent developments, particularly higher oil prices linked to tensions in the Middle East, have added upward pressure, the U.S. economy continues to show resilience," the portfolio manager says. Markets are pricing in a 25-basis-point rate hike Wednesday, which TwentyFour also views as the most likely outcome. "More important than the current inflation level is whether inflation returns to target quickly enough to prevent inflation expectations from becoming entrenched," Villarroel says. Chairman Kevin Warsh's recent comments suggest a strong focus on restoring the Fed's inflation-fighting credibility, but this meeting will provide the first real indication of how that translates into policy, Villarroel says. (emese.bartha@wsj.com)

0531 GMT - The market narrative of elevated inflation needing to be dealt with risks a further bond selloff if the Federal Reserve holds rates, says Laffer Tengler Investments' Byron Anderson in a note. "I think the Fed needs to give the market a hike or risk a bigger selloff, with market expectations of over 90% for a hike," the head of fixed income says. Anderson adds that it is hard to find a catalyst that will produce a bond market rally with the multiple cross currents of uncertainty still in the economy, "so we continue to hedge risk in our portfolios." Anderson also says the Fed has a tough situation on Wednesday. (emese.bartha@wsj.com)

0528 GMT - The renewed escalation in the Middle East conflict is keeping energy prices high and fueling the global rise in yields, DZ Bank analyst Christian Lenk says in a note. This is likely to warrant monetary-policy tightening. For the European Central Bank, DZ Bank expects a 25-basis-point hike in the fourth quarter, bringing the deposit rate to 2.75%. However, current market pricing for tightening toward 3% and above looks excessive, he says. DZ Bank also thinks the Federal Reserve is likely to deliver a precautionary hike. "But we also consider market expectations in the U.S. to be too hawkish," Lenk says. (emese.bartha@wsj.com)

0519 GMT - DZ Bank raises its forecast for 10-year Bund yields in the wake of recent rises, which could prompt a further hike by the European Central Bank in the fourth quarter, analyst Christian Lenk says in a note. For the 10-year Bund yield, DZ Bank's new three-, six- and 12-month forecasts are 3.30%, 3.10% and 3.00% respectively, versus 3.10%, 3.00% and 2.90%, previously, he says. "With the easing of pressure on the energy markets that we anticipate, the long end of the yield curve should pull back from its highs," he says. However, the German government's borrowing policy and a high volume of bond issuance are limiting the scope for a drop. The 10-year Bund yield hit 3.572%, the highest since 2009, on Tuesday. (emese.bartha@wsj.com)

0512 GMT - The 10-year U.S. Treasury yield did not go to 5% because something broke in America, it went to 5% in the company of every other global bond yield, says Siebert Financial's Mark Malek in a note. He points, in particular, to Japan's 10-year government bond yield crossing 3% for the first time in 30 years. "Japan, the country that spent a generation teaching the rest of us what zero looks like," the CIO says. "When every sovereign long end in the developed world reprices at the same time, in the same direction, the market is not rendering a verdict on any single borrower. It is remembering something it let itself forget for fifteen years-that lending money to anybody for ten years is a risk, and not a convenience," Malek says. (emese.bartha@wsj.com)

(END) Dow Jones Newswires

September 16, 2026 01:46 ET (05:46 GMT)