0738 GMT - Bitcoin eases after reaching a two-week high overnight as its recent appreciation loses steam. The pullback comes as tech shares are under renewed pressure after Samsung's results failed to impress lofty expectations. Geopolitical concerns also flare up again after Iran's Islamic Revolutionary Guard Corps fired missiles at two commercial ships near the Strait of Hormuz early Tuesday, the WSJ reports, citing a U.S. official. Bitcoin falls 0.7% to $63,355 after hitting a high of $64,539 overnight, according to LSEG. Bitcoin's recent recovery reflects a trimming of U.S. interest-rate rise expectations after last week's weak U.S. jobs data, although markets still expect tightening by year-end.(renae.dyer@wsj.com)
0730 GMT - Yields on 10-year U.K. government bonds, or gilts, rise to their highest in two weeks, tracking rises in U.S. Treasury yields. Treasury yields rise ahead of Wednesday's minutes of the Federal Reserve's June meeting as traders bet on a U.S. interest-rate increase by year-end. However, gilts could get a boost from the BOE's financial stability report at 0930 GMT, ING strategists say in a note. The report might include eased leverage ratio requirements for banks, which could make gilts more attractive, they say. "The leverage ratio is especially punitive for low-risk activities such as government bond repos." The 10-year gilt yield rises around 3 basis points to a high of 4.823% in early trade, Tradeweb data show. (jessica.fleetham@wsj.com)
0707 GMT - The 10-year German Bund yield rises to a two-week high of 2.974% in early trade, with yields rising across the board. Germany's rising net funding is among the drivers, but they also track higher U.S. Treasury yields. "The total net funding increase in the German budget draft 2027 and funding plan for the subsequent three years add up to 48.5 billion euros," Commerzbank's Christoph Rieger says. "This will increase net funding for 2026-2030 by 5% to over 1 trillion euros," the head of rates and credit research says. (emese.bartha@wsj.com)
0702 GMT - The dollar rises modestly as markets continue to bet on the Federal Reserve raising interest rates by year-end. Last week's weaker-than-expected U.S. nonfarm payrolls data prompted markets to trim rate-rise bets but there is still a 25 basis-point move fully priced by December, LSEG data show. The Fed's meeting minutes are due Wednesday which could provide signals on policy. While Fed Chair Kevin Warsh said a rate rise wasn't discussed in June, the minutes could offer a "more nuanced picture of whether he has pushed for a faster shift towards a tighter policy stance," Danske Bank analysts say in a note. Danske expects rate rises in December and March. The DXY dollar index rises 0.1% to 100.945. (renae.dyer@wsj.com)
0657 GMT - Japan's consumer prices, excluding fresh food, could stay below the Bank of Japan's 2% target until November, when government energy subsidies expire, says Okasan Securities economist Ko Nakayama. While rising oil prices will gradually push up logistics and packaging costs from the summer, falling rice prices will help cap near-term inflation, he says. However, that doesn't necessarily mean the timing of the central bank's next interest-rate increase will be delayed, he says. "Looking at the underlying inflation rate emphasized by the BOJ, the price trend is likely to rise steadily as the pass-through of energy and raw material costs, driven by the Middle East conflict, continues," he adds. (megumi.fujikawa@wsj.com)
0647 GMT - India's central bank is likely to stand pat for now, Raisah Rasid, global market strategist at J.P. Morgan Asset Management, said in a briefing. India is "very exposed" to commodity price swings, while El Nino could impact food prices going forward, she said. The Middle East situation seems contained for now, but prices of commodities like oil are likely to remain elevated as the flow through the Strait of Hormuz will take time to normalize, particularly because of physical and insurance risks, she added. As such, the RBI is unlikely to cut rates "especially in this climate that we're in," she said. (kimberley.kao@wsj.com)
0634 GMT - Sterling extends its gains against the euro to reach a fresh one-year high. Sterling's surprising resilience amid recent political turmoil reflects the fact that much of the bad news has already been priced in, Insight Investment's April LaRusse says in a note. "Investors have spent years positioning for U.K. underperformance, so as outcomes prove less negative than feared, and fundamentals begin to stabilize at the margin, the currency is finding support." Moreover, depressed U.K. equity valuations are attracting overseas interest, with U.S. buyers in particular driving a wave of mergers and acquisitions. If those flows continue then sterling could rise further, LaRusse says. The euro falls to as low as 0.8537 pounds. Against a stronger dollar, however, sterling falls 0.1% to $1.3377. (renae.dyer@wsj.com)
0628 GMT - China's unannounced long-range ballistic missile test over the Pacific on Tuesday could raise regional tensions and is likely to turn up the calls on Canberra to lift defense spending by more than what it already intends. Australian Prime Minister Anthony Albanese has indicated to Beijing his Labor government's concerns about China's unannounced missile test. It coincided with Australia advancing its diplomatic efforts with key Pacific nations this week. "We don't want to see any action that is destabilising or which undermines the peace, security and stability of the Pacific and the region," Albanese has told reporters. (james.glynn@wsj.com; X @JamesGlynnWSJ)
0552 GMT - Irish government bonds have performed well in 2026, with the strong performance driven by solid macroeconomic fundamentals, where Ireland continues to outperform European peers, Danske chief analyst Jens Peter Sorensen says in a note. His comments come ahead of the Irish National Treasury Management Agency's 1 billion euros-1.25 billion euros auction of 2036- and 2055-dated government bonds on Thursday. "The auctions are a 'liquidity event' that should be used to buy Irish govts [government bonds], especially in the long end of the curve," says the analyst who finds the 30-year maturity segment attractive to European bonds with similar maturity. (emese.bartha@wsj.com)
0538 GMT - U.S. Treasury yields rise, driven by the long-end of the curve, causing the yield curve to steepen. Markets await Wednesday's release of the minutes of the Federal Reserve's June meeting, while Tuesday's data calendar is thin. Besides, investors are keeping an eye on how the fragile Middle East ceasefire is being implemented, with the market's focus on how the oil market is physically slowly recovering, SEB economist Marcus Widen says in a note. The two-year Treasury yield rises 0.8 basis points to 4.131%, while the 10-year yield is up 2 basis points at 4.498%, according to Tradeweb. (emese.bartha@wsj.com)
0532 GMT - Trade is expected to have made a smaller contribution to Indonesia's economic growth in 2Q due to slowing export growth and higher fuel and refined oil imports, DBS senior economist Radhika Rao says in a note. While government spending helped support economic activity in 1H, fiscal expenditure is expected to moderate in 2H as lower oil prices reduce subsidy costs, she reckons. Indonesia's trade conditions could improve in 3Q once global oil prices stabilize and shipping through the Strait of Hormuz recovers. DBS expects Indonesia's economy to grow 5.1% in 2026 and sees another 25 bps rate hike from Bank Indonesia, depending on market conditions. (yingxian.wong@wsj.com)
0525 GMT - Japan's consumer behavior is expected to remain on a recovery track after Tuesday's data showed household spending rose 3.7% in May from the previous month. "Recent consumer spending is likely being supported by recovering real wages--thanks to government caps on energy prices--and positive wealth effects" driven by rising share prices, SMBC Nikko Securities economists say. With rice prices on the downtrend and government energy subsidies helping to curb some pressures, households' inflation expectations are likely to start easing, they add. Separate government data released Tuesday showed inflation-adjusted wages rose 1.4% year-over-year in May. (megumi.fujikawa@wsj.com)