The latest Market Talks covering FX and Fixed Income. Published exclusively on Dow Jones Newswires throughout the day.
1037 ET - Brazil's central bank takes a cautious approach to the interest-rate cutting cycle launched last week, according to minutes published today. The BCB cut to 14.75% from 15%, frustrating expectations of faster easing. The minutes indicated "the magnitude of additional cuts and the depth of the cycle will be a function of data and the breadth and duration of war in the Middle East," Goldman Sachs' Alberto Ramos writes. The minutes leave the door open to a larger cut in April, but in Ramos' view "that may require an improvement in the external backdrop and limited impact on current inflation and inflation expectations." (paulo.trevisani@wsj.com; @ptrevisani)
1031 ET - The U.K. faces a "non-negligible risk of a mild recession" due to the effects of the Middle East war, Nuveen's Laura Cooper says in a note. Economic growth is weak and the unemployment rate is at a multi-year high of 5.2% but the risk of inflation due to high energy costs limits the Bank of England from cutting interest rates to support the economy, Cooper says. U.K. public finances are weakening, making it difficult for the government to offer support to households amid rising energy costs. Should high energy costs lead the BOE to raise interest rates, it increases the risk of U.K. sliding into a mild recession, she says. (miriam.mukuru@wsj.com)
1021 ET - U.S. home prices were little changed from a month earlier in February, Redfin says, rising 0.1% on a seasonally adjusted basis. That's the slowest growth in seven months. Prices increased 1.9% year-over-year. Price growth is muted because it's the strongest buyer's market in recent history--for those who can afford to buy. There are a record 46% more home sellers than buyers, meaning the buyers who are in the market have negotiating power when it comes to price. Prices are still rising slightly, but this growth pales in comparison to recent years. Mortgage rates have ticked up in the past few weeks following months of declines, but Redfin still expects housing affordability to improve this year as income growth outpaces home price growth. (chris.wack@wsj.com)
0949 ET - More than 42,000 U.S. home-sale agreements fell through in February, Redfin says. That's equal to 13.7% of homes that went under contract that month, and up from 12.8% a year earlier. Nearly one in every seven homebuying deals are falling through largely because buyers are in the driver's seat. There are hundreds of thousands more home sellers than buyers in the country. A buyer may back out of a contract during the inspection period if they see a home they like better or an issue comes up that they don't want to repair. House hunters are also feeling jittery because of economic and geopolitical uncertainty, Redfin says. (chris.wack@wsj.com)
0917 ET - Sterling could weaken in the second quarter due to fiscal risks related to upcoming U.K. local elections, Barclays analysts say in a note. "Geopolitical developments have pushed U.K. politics to the background, but risks of a more expansionary fiscal policy have likely risen in the wake of the energy shock and the upcoming May local elections," they say. Accordingly, sterling's fiscal risk premium is likely to re-widen in the second quarter closer to levels seen around the November autumn budget, they say. Barclays expects the euro to rise to 0.88 pounds in the second quarter from 0.8652 currently. However, it expects the euro to fall back to 0.86 pounds by the fourth quarter if the fiscal premium gradually normalizes. (renae.dyer@wsj.com)
0915 ET - The Middle East war risks driving up corporate defaults in Europe due to the effects of the conflict, analysts at the Investment Institute by UniCredit say in a note. "High oil and gas prices and interrupted supply chains create new credit risks, potentially leading to higher default rates in the medium term," they say. Credit markets are showing early signs of stress, with an increase in the share of iBoxx CCC-rated credit trading at distressed levels to nearly 50%, from 20% prior to the Middle East war, the analysts say. A prolonged war and high energy costs would create a negative environment for some European issuers, they say. (miriam.mukuru@wsj.com)
0913 ET - The latest PMI survey data for the eurozone paint a difficult situation for the European Central Bank, Commerzbank's Vincent Stamer says in a note. While the war in the Middle East has meant the outlook for the economy is darkening, inflationary risks are mounting and uncertainty is hitting the services sector particularly hard, he says. "Central bankers cannot ignore this rise in consumer prices. However, uncertainty is also very high for the ECB, so it will likely monitor the data for the time being before raising key interest rates." Nevertheless, the PMI as a whole remains within the range where the eurozone's economy has grown at least moderately, Stamer says. (edward.frankl@wsj.com)
0856 ET - A bout of optimism in global markets fades as Tehran denies direct talks with the U.S. and fresh attacks by Iran on its Gulf neighbors temper hopes for a quick resolution. Treasury yields rise slightly, while the dollar strengthens and oil prices rise. U.S. March manufacturing PMI is expected to rise slightly, while the services survey is likely to slip, in a WSJ consensus. The 10-year yield is at 4.386%, up from 4.334% at yesterday's settle. The two-year rises to 3.897% from 3.830%. The WSJ Dollar Index rises 0.3%. (paulo.trevisani@wsj.com; @ptrevisani)
0851 ET - Bitcoin struggles for direction as uncertainty over the Iran war remains elevated. President Trump said Monday that the U.S. would postpone military strikes against Iranian energy infrastructure for five days after constructive talks but Iran denied any negotiations took place. Trump's comments helped calm global risk sentiment and boost cryptocurrencies, LMAX Group's Joel Kruger says in a note. "Looking ahead, the tone remains cautiously constructive." If global risk sentiment is supported and flows continue to stabilize, bitcoin appears well-positioned for further appreciation with ether likely to follow, he says. Bitcoin last trades flat at $70,894 after earlier gains, LSEG data show. Ether is flat at $2,163. (renae.dyer@wsj.com)
0833 ET - The dollar is currently supported by elevated energy prices stemming from the Middle East conflict but its risk premium hasn't declined, Barclays analysts say in a note. Markets continue to demand a higher premium for dollar exposure as compensation for increased U.S. policy uncertainty, they say. This hasn't changed since the conflict began even as the dollar benefits from America's energy independence. "If the premium has not been eliminated during this favorable time for the dollar, then it should remain sticky once conditions normalize too." It is therefore reasonable to expect a degree of dollar softness in the near term, they say. The DXY dollar index rises 0.4% to 99.365. (renae.dyer@wsj.com)
0730 ET - The dollar could stay confined to a tight range in the near term due to uncertainty over the Middle East conflict, ING's Chris Turner says in a note. The dollar briefly fell Monday on reduced demand for safe havens and lower oil prices due to America's energy independence after President Trump said the U.S. would postpone military strikes against Iranian energy infrastructure for five days. Traders will be eager to hear, particularly from Iran, whether there's any realistic chance of ceasefire negotiations, Turner says. "Until then, any further rally in risk assets and selloff in the dollar will prove limited." The DXY dollar index rises 0.3% to 99.280. ING expects it to trade in a range of 99.00-100.00 for now. (renae.dyer@wsj.com)
0728 ET - The cost of default protection for euro credit stays steady at elevated levels as investors exercise caution given the uncertainty around the Middle East war. Markets stay volatile as new developments unfold in the U.S.-Iran conflict, IG analysts say in a note. The iTraxx Europe Crossover index of euro high-yield credit default swaps is steady at 343 basis points, close to the 11-month high of 365 bps reached on Monday, S&P Global Market Intelligence data show. The iTraxx Europe Main index of euro investment-grade CDS is unchanged at 69bps. (miriam.mukuru@wsj.com)
(END) Dow Jones Newswires
March 24, 2026 10:37 ET (14:37 GMT)
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