1216 ET - Treasury yields and the dollar keep rising after a batch of somewhat reassuring U.S. indicators. The Conference Board consumer confidence index ticks higher to 91.2, although below WSJ consensus of 94.2. May job openings were unchanged at 7.6 million. Fed funds futures price in 83% odds of at least one hike this year, according to CME's FedWatch tool. Employment data due the next couple of days are expected to cool down while staying at healthy levels, in WSJ surveys. The 10-year yield is at 4.402%, on pace for a third consecutive quarterly rise. The WSJ Dollar Index rises slightly, on track for its fourth consecutive quarterly gain. (paulo.trevisani@wsj.com; @ptrevisani)
1209 ET - The Bank of England has space to judge the broader impact of the Iran war on inflation before it considers the next interest-rate move, its Governor Andrew Bailey says. Markets at the start of 2026 had expected rate cuts this year, but in March that needed to be taken off the table due to the conflict, he told CNBC in an interview at the European Central Bank's Sintra conference. That led to investors raising bets on monetary-policy tightening, which, for instance, drove higher mortgage rates. "So we've had some tightening built into the curve which gives us some time to judge the pass-through," Bailey says. However, the bank isn't "complacent" in bringing inflation down to the 2% target slower than previously anticipated. (edward.frankl@wsj.com)
1159 ET - The increase in energy prices and its impact on inflation due to the Iran war has been frustrating, but it is being met by a softer economy that is weighing on prices, Bank of England Governor Andrew Bailey says. Inflation would have fallen to the bank's 2% target in April or May without the conflict, he told CNBC at the European Central Bank's forum in Sintra, Portugal. But softening economic activity in recent months, a cooling labor market and the fall in oil prices in the last few weeks suggests indirect effects are coming in lower than expected, he says. "I am encouraged by that". Inflation will still rise a little higher to around 3.2%, he adds, from 2.8% in May. (edward.frankl@wsj.com)
1139 ET - Analysts with TD Cowen publish new price targets for both Strategy Inc. and bitcoin, maintaining a view that both will rebound by the end of the year, but cutting the outlook for how high they bounce. The firm says it now forecasts bitcoin to jump to around $100,000 by the end of 2026, down from a previous target of $140,000 by the end of the year but still up 72% from where bitcoin is trading as of today. Meanwhile, for Strategy, TD Cowen projects a price target of $260, down 35% from its previous forecast, although still up more than 200% from where it's trading now. Strategy is down 7.7% to $85.53 today, while bitcoin falls 3.3% to $58,223. (kirk.maltais@wsj.com)
1130 ET - Cleveland Fed President Beth Hammack says if higher inflation trends continue, the Fed may need to raise interest rates to restore inflation to target, citing robust consumer spending and short-term inflationary pressures from the AI data center buildup. Outside of higher energy prices, Hammack says during a CNBC interview, "When I look at that core inflation, that's been very elevated." Additionally, Hammack adds that she wants to see if consumer spending continues to hold up. "If it does, then that says to me that policy may not be restrictive enough to help us bring inflation back down," she says.(jessica.coacci@wsj.com)
1122 ET - Japan's efforts to support the yen could have implications for U.S. government borrowing, Corpay's Karl Schamotta tells WSJ in an email. Tokyo is widely expected to intervene as the yen hits a 40-year low against the dollar. Schamotta says past interventions have seen a relatively small amount of sales from Japan's large holdings of Treasurys, since a significant selloff would cause U.S. yields to spike, further strengthening the greenback. However, Japanese FX policies could seek to keep more capital at home, hampering dollar-bound flows that for years have allowed Washington to finance its own debt. The U.S. "has grown accustomed to Japanese demand for its debt," Schamotta says. "It should not assume that demand is unconditional." (paulo.trevisani@wsj.com; @ptrevisani)
1106 ET - Inflation in Germany fell more sharply than expected in June, mainly on easing energy and food prices. Although core inflation stayed unchanged, there's little evidence of indirect effects from energy prices into costs of other goods, Commerzbank's Ralph Solveen says in a note. Based on available data, the eurozone's inflation rate for June is likely to be slightly lower than the consensus forecast of 3.0%, he says. However, oil prices are set to return to somewhat higher than current levels in the coming months, due to recurring bad news from the Middle East, Solveen says. That means inflation is likely to move sideways between 2.5% and 3%, and given companies will likely pass on higher energy costs to customers, core inflation may rise slightly again, he adds. (edward.frankl@wsj.com)
1101 ET - Geopolitical conflicts and the AI boom are driving up demand for energy supply, benefiting companies in the electricity supply chain, BlackRock Investment Institute say in a note. "Many governments and companies are prioritizing resilience [in energy supply]," they say. Assets such as power equipment, batteries, grids, and critical materials are gaining from the rising electricity demand, BlackRock Investment Institute say in a note. (miriam.mukuru@wsj.com)
1100 ET - The dollar could ease if Thursday's U.S. nonfarm payrolls report is weaker than expected, TD Securities strategists say in a note. "We think dollar strength is nearing a peak, absent reacceleration in U.S. data beyond our baseline of stability." A payrolls print that trails expectations would confirm this view, they say. Markets are betting on interest-rate rises by the Federal Reserve as they seem priced for a period of mini-exceptionalism in the U.S. Meanwhile, U.S. equity outperformance is taking a breather which could further wane the dollar's upward momentum, they say. The DXY dollar index is steady at 101.077. (renae.dyer@wsj.com)
1057 ET - Another interest-rate hike from the European Central Bank could become a policy mistake, ING global head of macro Carsten Brzeski says in a note. ECB President Christine Lagarde reiterated Monday that the June rate increase was driven by a higher inflation outlook. But with the recent drop in energy prices, chances have increased that forecasts could show inflation below 2% in 2027, Brzeski says. Judging from Lagarde's comments and other ECB officials in recent weeks, that wouldn't stop the ECB from hiking again, he notes. "As long as the core inflation forecasts aren't revised downwards, there appears little in the way to stop the ECB." But a new debate could emerge over looking through what could be a temporary energy-price shock, he says. (edward.frankl@wsj.com)
1043 ET - Credit investors should pay attention to underlying economic risks rather than dwelling on credit labels like public bond, direct loan, leveraged loan and so on, BlackRock Investment Institute say in a note. Factors such as recurring cashflow and lender protections are more accurate metrics, they say. "We favor credit where income is backed by fundamentals - and where investors are paid for liquidity and recovery risks." (miriam.mukuru@wsj.com)
1026 ET - The median U.S. luxury home sale price rose 4.7% year over year to $1.37 million during the three months ending May 31, Redfin says. That's more than triple the 1.5% gain in non-luxury sale prices. Luxury prices are increasing largely because demand for luxury homes is on the rise. Pending sales of luxury homes rose 5.2%, compared with a 3.6% gain in non-luxury pending sales, which is deceleration from the month before. High-end homebuyers are less sensitive to affordability pressures and financial instability. Overall homebuying demand has been fairly slow because mortgage rates and home prices remain high. Ultra-wealthy Americans have the freedom to make big purchases even in uncertain times. (chris.wack@wsj.com)