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.

0911 ET - Expectations for higher interest rates rise sharply following the September CPI print. Markets are pricing in a 95.7% probability of at least one rate hike by the Fed's December meeting, according to CME FedWatch. For October, the probability of a quarter-percentage-point rate hike rises to 49.3%, from 22.1% Tuesday. Following Thursday's wholesale inflation report, economists will begin submitting their forecasts for the Fed's preferred inflation gauge, the PCE price index. (jessica.coacci@wsj.com)

0900 ET - Gold futures extend early losses after September core U.S. CPI comes in higher than expected, pushing up yields and the U.S. dollar. Factors behind dollar gains include geopolitical developments on the war front and the IMF chief saying U.S. Treasury Secretary Scott Bessent's growth plans aren't enough to tame surging deficits and the mounting debt pile, Peter Cardillo of Spartan Capital says in a note. "Ironically, these concerns provide another reason to buy precious metals." Gold for December delivery is down 1.2% in New York at $4,126.50 a troy ounce. Silver falls 2.7% to $57.92 a troy ounce. (anthony.harrup@wsj.com)

0853 ET - Gold prices extend losses after the latest U.S. inflation figures came in hotter than expected. The consumer price index rose 3.7% in September from a year earlier, above analysts' expectations of a 3.6% increase. The data could complicate the Federal Reserve's efforts to bring inflation under control and raise the prospect of another interest-rate hike if price pressures persist. Following the release, the CME's FedWatch tool showed traders pricing in a nearly 44% chance of a rate hike in October, up from 21% previously. Higher interest rates generally weigh on gold, which offers no yield. In early U.S. trading, New York gold futures are down 1.5% to $4,114.10 a troy ounce. (giulia.petroni@wsj.com)

0846 ET - Treasury yields rise sharply as U.S. inflation surprises on the upside. The 12-month September CPI accelerates to 3.7% from August's 3.4%, versus WSJ consensus of 3.6%. Core inflation was 2.6%, up from 2.4% and hotter than expectations of 2.5%. The data is likely to bolster bets on a Fed hike this month. The WSJ Dollar Index rises 0.3% after being flat ahead of the data. The 10-year yield jumps to 5.291% from 5.261% on the inflation numbers. The two-year rises to 4.914% from 4.781%. The 30-year is at 5.599%, up from 5.539%. (paulo.trevisani@wsj.com; @ptrevisani)

0655 ET - The recent proliferation of artificial intelligence hacking incidents are early warning shots, Demis Hassabis, co-founder and chair of Google DeepMind, says at the International AI Summit in Dublin. AI systems themselves are not that powerful yet so the incidents aren't that major, he says, adding that they could be in the next year or so unless the industry puts more work into governance. The tech sector can learn from other industries that have dealt with critical systems, he adds. (edith.hancock@wsj.com)

0603 ET - The euro is struggling to recover momentum, dropping to its lowest since June 2025 against sterling, even as the dollar drops back from a recent 18-month high against a basket of currencies. The euro has struggled particularly against non-dollar currencies, suggesting that France's budget concerns continue to weigh on the currency, ING's Francesco Pesole says in a note. The euro falls 0.1% to $1.1192 against the dollar and could drop toward $1.1150 in the coming days, he says. Against sterling, the euro loses 0.1% to hit a 16-month low of 0.8433 pounds, LSEG data show. (jessica.fleetham@wsj.com)

0529 ET - The cost of insuring euro-denominated credit against default falls as European stocks and U.S. equity futures rise. A recovery in AI-related stocks boosts sentiment after Dutch group ASML Holding lifted its guidance for the third time this year. However, concerns about excessively high financing needs for AI-related projects and whether credit demand will be sufficient keep high-yield CDS prices elevated. "Supply bottlenecks, valuation pressure and concentration risk leave the [AI] sector vulnerable," says Tickmill Group's Patrick Munnelly in a note. The iTraxx Europe Crossover index of euro high-yield credit default swaps falls 4 basis points to 311bps but stays close to last week's six-month high of 316bps, S&P Global Market Intelligence data show. (jessica.fleetham@wsj.com)

0521 ET - As concerns about France's fiscal stability mount, the IMF's managing director remains hopeful that policymakers can set a budget that would put deficit and debt on a downward trajectory. But it will take time to reach levels that provide confidence, Kristalina Georgieva says at the IMF-World Bank meetings in Bangkok. "I remain positive in [the] expectation that France will have a budget that sets this direction of [a] downward trend." She notes a eurozone-wide impact in terms of yields rising--even in countries that traditionally never see such moves. Unless debt levels shrink, the cost of financing will get heavier and heavier. "There is no magic. You have to go in [the] direction of tightening debt, bringing it down, bringing deficits down." (fabiana.negrinochoa@wsj.com)

0507 ET - High bond yields in advanced economies pose a threat to hard-won gains in emerging markets, says IMF Managing Director Kristalina Georgieva. "Too many countries did not use the post-pandemic recovery to rebuild fiscal buffers, and each new shock has pushed debt levels higher," she says at the IMF-World Bank meetings in Bangkok. "This time around, advanced economies are the worst offenders," and higher yields are raising debt-servicing pressures in countries that are particularly vulnerable. "What is our loudest call to policymakers right now? Make urgent repairs to the fiscal house before the cracks widen." Now is the time to boost revenue, rationalize spending and improve public financial management, she says, urging temporary and targeted support to the most vulnerable. (fabiana.negrinochoa@wsj.com)

0445 ET - Saudi Arabian and U.A.E. chemical producers face a test of their ability to redirect exports as disruptions to shipping through the Strait of Hormuz continue, S&P Global Ratings says. Company results should provide evidence of how effectively producers have used alternative routes despite logistical constraints, according to the ratings firm. Solid chemical products are generally easier to store or reroute than liquids, which require specialized storage and transportation infrastructure. S&P says the conflict has disrupted regional chemical exports and production, making geographic diversification an important factor in companies' credit resilience. (farhan.rafid@wsj.com)

0443 ET - The U.K.'s Debt Management Office is due to sell 5.0 billion pounds in gilts maturing May 2030 at an auction at 0900 GMT on Wednesday which should see good demand, RBC Capital Markets strategists say in a note. A gap in supply of bonds of this maturity, plus a cheapening of the May 2030 gilt ahead of the auction, "bodes well for demand today." However, the strategists are cautious as three-year bonds are sensitive to moves in oil prices. Gilts overall are also vulnerable to any further spread widening in eurozone bond markets and ahead of the U.K. budget on Oct. 28, they say. The May 2030 gilt yield is last down 5.7 bps at 4.922%, Tradeweb data show. (jessica.fleetham@wsj.com)

0400 ET - Yields on U.K. government bonds, or gilts, fall after Bank of England Chief Economist Huw Pill expressed doubt that the four quarter-point interest-rate hikes that markets are pricing in will be needed to contain inflation. Money markets price more than 100 basis points of rate hikes over the next 12 months, starting with a hike in November, LSEG data show. "Is it obvious that we will need to follow market pricing to four 25 basis point hikes?" Pill said. "There I would be a little more skeptical." U.K. 10-year gilt yields fall by more than their eurozone peers, dropping 4.9 basis points to 5.394%, according to Tradeweb. (jessica.fleetham@wsj.com)

(END) Dow Jones Newswires

October 14, 2026 09:11 ET (13:11 GMT)