The latest Market Talks covering FX and Fixed Income. Published exclusively on Dow Jones Newswires throughout the day.

2022 ET - JGBs fall in price terms in the morning Tokyo session after the Bank of Japan's Tankan survey showed higher inflation forecasts. Japanese enterprises have raised their inflation forecasts for one year, three years and five years ahead, backing the case for more rate increases from the BOJ. The Tankan indicated Japanese enterprises projected consumer prices to rise 2.5% in one year versus 2.4% increase in the prior survey, and to rise 2.4% in three years versus 2.3% increase in the prior survey. They also forecast inflation to rise 2.3% in five years from a 2.2% increase in the prior survey. The 10-year JGB yield is up 2bps at 1.505%. (ronnie.harui@wsj.com)

2013 ET - Japanese stocks are higher in early trade as the yen weakens and following Monday's stocks selloff. Energy and real-estate stocks are leading the gains. Eneos Holdings is up 3.1% and Mitsui Fudosan is 2.7% higher. USD/JPY is at 149.89, up from 148.82 as of Monday's Tokyo stock market close. Investors are closely watching any developments related to U.S. trade and foreign policies. The Nikkei Stock Average is up 1.0% at 35964.88. (kosaku.narioka@wsj.com; @kosakunarioka)

2006 ET - Asian currencies consolidate against the dollar in early Asian trade with markets in a nervous mood before President Trump's so-called "Liberation Day" tariffs due Wednesday. "Markets are clearly very jittery" ahead of this tariff announcement, NAB's Tapas Strickland says in commentary. It seems that the tariffs could be broader than just the 'dirty 15' which had excited the markets last week, while industry-specific tariffs were also being discussed, the head of Market Economics says. USD/KRW is steady at 1,473.01; USD/SGD is little changed at 1.3431; AUD/USD edges 0.1% lower to 0.6241. (ronnie.harui@wsj.com)

1954 ET - Japanese stocks may rise as the yen weakens and bouncing after Monday's stock selloff amid concerns about U.S. tariffs. Nikkei futures are up 0.8% at 35975 on the SGX. USD/JPY is at 149.99, up from 148.82 as of Monday's Tokyo stock market close. Investors are focusing on any developments related to U.S. trade and foreign policies. On Monday, the Nikkei Stock Average dropped 4.0% to 35617.56, its biggest one-day percentage drop since Sept. 30. (kosaku.narioka@wsj.com)

1911 ET [Dow Jones]--General insurer Tower leads the New Zealand share market lower after trading restarts following the exit of Bain Capital from its register. Tower falls 7.7% to NZ$1.37 after Bain said it had completed the NZ$88.8 million sale of its roughly 19.9% stake to investors at a fixed price of NZ$1.30/share. Tower has been one of the best performers among NZ equities over the past year and a bit. Tower's share price was below NZ$0.62 at the beginning of February 2024, before a series of earnings upgrades led investors to buy more of the stock. Last month, Tower shares hit their highest level in nearly a decade. (david.winning@wsj.com)

1555 ET - Treasury yields are mixed after spending most of the day below Friday's level, but sustain heavy losses in the 1Q, as optimism around Trump's promised deregulation and tax cuts earlier this year gave way to concerns about tariffs. U.S. March manufacturing PMI data tomorrow are expected to decline, in a WSJ survey. The JOLTS report will kick off the batch of employment indicators that will culminate with March payrolls on Friday. The administration's new round of tariffs is expected on Wednesday. The 10-year yield falls 0.332 percentage point in 1Q, to 4.245%, including a small loss today. The two-year rises slightly today, but ends the quarter down 0.338 p.p., at 3.911%. (paulo.trevisani@wsj.com; @ptrevisani)

1453 ET - Canada's banks have ratings headroom to face up to the worsening economic outlook brought on by significant U.S. tariffs, at least in the near term, Fitch Ratings says. Fitch projects a recession for Canada this year, with rising unemployment and high inflation due in part to the trade war with the U.S. Yet the lenders have solid financial profiles, relatively health asset-quality metrics and ample capitalization. And Fitch reckons that even if impairments rise to a level that results in significant losses that pressure earnings, that won't affect rating sensitivities in the short term. Longer term, however, and banks have less ratings headroom if earnings pressures become structural, Fitch adds. (robb.stewart@wsj.com)

1444 ET - U.S. investors looking to reduce risk might want to shift some of their bets to credit assets from stocks, Oaktree Co-Chairman Howard Marks says in a market note. "The bottom line for me continues to be that non-investment grade credit currently represents a better risk/return deal than the S&P 500," Marks says. He points to "an extended economic recovery, the general predominance of optimism [and] above-average equity valuations" as indicators that U.S. investors would be better off playing defense than offense at the moment. He also cites "a poorly functioning governmental/fiscal mechanism and substantial geopolitical uncertainty." (luis.garcia@wsj.com; @lhvgarcia)

1249 ET - Credit spreads are likely to widen modestly due to uncertainty around tariffs, Societe Generale credit strategist Juan Valencia says in a note. Credit assets are, nonetheless, less likely to record sustained spread widening, but move in narrow ranges until there is clarity around tariffs, he says. "Credit may remain a little volatile, but we do not think this is the start of a sustainable widening trend." (miriam.mukuru@wsj.com)

1219 ET - A couple of surveys give a boost to Treasury yields, although they remain below Friday's settlement and on pace for a sharp quarterly decline. The Chicago Business Barometer PMI rises in March to 47.6 from February's 45.5, against forecasts of a decline. The Texas manufacturing outlook survey's business activity gauge falls to a negative 16.3 from minus 8.3, but the production index expands in March after contracting in February. Yields have been recovering since the data came out. The 10-year is at 4.232% and the two-year at 3.901%. (paulo.trevisani@wsj.com; @ptrevisani)

1129 ET - Municipal bond investors show concern about a potential reduction of the securities' tax exemption, Bank of America economists write. "Muni funds saw notable outflows this week, potentially reflecting headlines around their tax-exempt status," they say. BofA says munis funds had a $401 million outflow in the week of March 26, a period in which fixed-income funds overall had a $1.96 billion inflow. The munis outflow happens as Congress floats the reduction of munis' tax incentives to offset an extension of federal tax cuts. The S&P Municipal Bond total return index is down 0.5% this year as of Friday, according to FactSet. (paulo.trevisani@wsj.com; @ptrevisani)

1123 ET - While German inflation was expected to fall in March, the noticeable fall in the core rate is a positive note, Deutsche Bank Research economist Sebastian Becker says in a note. Headline inflation is now expected to remain between 2.0% and 2.5% in the coming months, he says. But there is greater uncertainty to come from the tightening of global trade, which is likely to have both inflationary and disinflationary effects, Becker adds. (edward.frankl@wsj.com)

(END) Dow Jones Newswires

March 31, 2025 20:22 ET (00:22 GMT)

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