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.

1104 ET - Major cryptocurrencies are dropping, with investors anxious about the possibility of a rate hike Wednesday by the Fed, and "an ongoing deleveraging in the tech sector," says Stephen Coltman of 21shares. The shelving of the Clarity Act for now by the U.S. Senate is also weighing on crypto. Bitcoin is down 2.8% to $63,130, while ethereum falls 3.5% to $1,877, XRP sheds 3.6% to $1.05, and solana is down 4.1% to $72.80. (kirk.maltais@wsj.com)

1059 ET - Prolonged heat stress and crop damage from Europe's recent heatwaves and fires could create pressure across the food supply chain, Activtrades analyst Ion Jauregui says. Estimated losses of around $2 billion in grain farmer revenue highlight the wider economic impact. Although agriculture represents a limited share of GDP, food prices have a strong influence on inflation because they directly affect household spending, he says. "The main impact on supermarkets would likely be higher costs rather than empty shelves." Lower crop yields can also increase prices for wheat, barley and corn, while also raising costs for livestock producers and food manufacturers, he notes. "Persistent food inflation could slow the decline in inflation and complicate central bank decisions on interest rates," Jauregui says. (edward.frankl@wsj.com)

1057 ET - The impact of Europe's wildfires depends not only on the severity of the hazard itself, but also on industries in its path, Oxford Economics senior economist Daniel Parker says. Around Bordeaux, Gironde's wine industry, agrifood production and logistics networks mean local disruption quickly ripples through supply chains and exports, he says. In Spain, Valencia's concentration of manufacturing, tourism, agriculture and logistics leaves much of its economy dependent on physical assets and transport infrastructure. Near Madrid, fires create impacts beyond the immediate hazard zones on agriculture and transport. "As wildfire seasons become longer and more intense, the effects are increasingly felt through disruptions to production, tourism flows, transport, and supply-chain bottlenecks that extend far beyond the areas directly affected." (edward.frankl@wsj.com)

1054 ET - Investors could be overpricing the possibility of interest-rate rises by the Bank of England in the coming months, Insight Investment's Jessica Shuman says in a note. Markets fully price in one quarter-point BOE rate increase in November, LSEG data show. At 3.75%, the BOE rate is already restrictive and U.K. growth is weak, lowering the prospects of interest-rate rises later this year, Shuman says. "We believe the Bank will prove more reluctant to tighten further than current market pricing implies." (miriam.mukuru@wsj.com)

1043 ET - Renewed U.S. tariff threats are compounding unease for businesses across Canada and are stacking on an investment slowdown, a quarterly report by the Canadian Chamber of Commerce finds. Based on a Statistics Canada survey, the chamber says just 1% of Canadian businesses plan to establish operations in the U.S., yet far more are postponing investment and delaying expansion until conditions become more certain. The highest rates of delayed investment and postponed expansion in Canada are among manufacturers, yet relatively few plan to relocate production or establish U.S. operations, it says. The report finds most companies could take on additional debt, which indicates that uncertainty and not financing capacity is the primary constraint on investment. (robb.stewart@wsj.com; @RobbMStewart)

1013 ET - The number of Canada-based Redfin.com users searching for U.S. homes to buy or rent fell 15.3% year-over-year in June, according to Redfin. That after a 10.1% decline in May. Over the past two years, Canadian searches for U.S. homes have dropped roughly 37%, after posting a 25.7% year-over-year decline in June 2025. Redfin says Canada's economy is starting to recover after a weak start to the year, but uncertainty around trade, jobs, the domestic housing market and inflation is still prompting many Canadians to think twice about making a major purchase. Canada-based home searches declined from a year earlier in 45 of the 50 most populous U.S. metros. (chris.wack@wsj.com)

1010 ET - The U.S. Federal Reserve is expected to leave interest rates unchanged at Wednesday's rate decision, but it could indicate a willingness to increase rates at future meetings, eToro's Lale Akoner says in a note. "We think the most likely outcome is a hold with a hawkish tone, tougher language on inflation and little comfort for anyone hoping the rate-hike debate is over," she says. U.S. money markets are fully pricing in one quarter-point rate Fed rate increase in September, LSEG data show. (miriam.mukuru@wsj.com)

0959 ET - The selloff in the Japanese yen and the country's government bonds reflect the Bank of Japan's inflationary policy, BCA Research's Mathieu Savary says in a note. Japan's real policy rate adjusted for inflation stands at -0.75%, he says. It was only more negative during the global inflation surge that followed the Covid-19 pandemic, he says. Accommodative monetary policy combined with budding inflationary pressure is worrying yen and bond investors as it is forcing the economy to overheat, he says. The yen and bonds face further weakness over 2026, he says. The dollar rises 0.1% to 163.85 yen, having reached a 40-year high of 163.98 last week, LSEG data show. Japan's 10-year yield is little changed at 2.775%. (renae.dyer@wsj.com)

0959 ET - The dollar could suffer knee-jerk weakness if the Federal Reserve leaves interest rates steady on Wednesday, TD Securities strategists say in a note. Market pricing on LSEG shows a 34% possibility that the Fed could raise rates Wednesday and are fully pricing a move by September. The TD analysts expect unchanged rates with Beth Hammack and Lorie Logan dissenting in favor or raising rates. Still, any short-term dollar weakness will likely be limited as Fed rate-hike pricing for the rest of the 2026 remains intact, they say. TD sees Fed Chair Kevin Warsh providing little forward guidance, reiterating a commitment to price stability. Warsh could note the fall in recent inflation data while suggesting inflation remains elevated, they say. (renae.dyer@wsj.com)

0942 ET - An interest rate increase by the Fed tomorrow can't be ruled out and it would give Chairman Warsh "massive inflation credibility," Bank of America strategists write. Although they expect a hold with a couple of hawkish dissents, there is more uncertainty than usual, as oil prices spiked following June's soft inflation numbers. BofA points out that since 1994 the Fed has never hiked with less than 60% priced. According to CME, a hike is priced at 32%. BofA expects the hawkishness to flatten the Treasury curve, with shorter-term yields rising and longer-term ones falling. That would also strengthen the dollar, the strategists say. (paulo.trevisani@wsj.com; @ptrevisani)

0937 ET - Wage growth has slowed noticeably in Canada's labor market, or below 3% on a 12-month basis, which likely portends a subsequent cooling in household consumption as inflation stays near or above 3%, says economist Brendon Bernard at job-posting site Indeed.com. Overall, Canada's labor market has stabilized with a decent 2Q showing, although Bernard says a further pickup in hiring is not in the cards due to stagnant population growth. "Slow job growth is likely to continue through 2026," Bernard says, adding the deceleration in wages "presents a real risk" to the broader economy, given elevated energy prices. The drop in wage growth threatens "to erode purchasing power gains built up over the past few years." (Paul.Vieira@wsj.com; @paulvieira)

0913 ET - Sterling could fall in coming months if the Bank of England avoids raising interest rates and political friction over budget cuts emerges under new Prime Minister Andy Burnham, Rabobank's Jane Foley says. The BOE is expected to keep rates unchanged Thursday but some policymakers could favor raising rates, fueling the debate about the risk of future tightening, she says in a note. Against a background of soft economic activity indicators and uncertainty over the government's autumn budget, Rabobank expects steady rates through to year-end. Meanwhile, Burnham's plans to tackle welfare reform could spark tensions within the ruling Labour Party, Foley says. The euro falls 0.1% to 0.8547 pounds and Rabobank expects it to reach 0.8700 in three months. (renae.dyer@wsj.com)

(END) Dow Jones Newswires

July 28, 2026 11:04 ET (15:04 GMT)