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

1111 ET - Bitcoin could rise further after the July U.S. inflation data reduced market pricing for a September interest rate rise by the Fed, 21shares strategist Matt Mena says in a note. The data showed inflation eased to 3.4% last month, as expected. Money markets price a 40% chance of a 25 basis points rate rise in September, compared to 48% before the data. This could be the relief bitcoin needs to rise sustainably above $64,000 and push towards the $66,000 resistance level, Mena says. Historically, bitcoin has returned an average rise of 3.7% following an in-line inflation print over the past three years, he says. Bitcoin is down 0.4% to $63,448. (renae.dyer@wsj.com)

1059 ET - The July CPI report is unlikely to determine what FOMC policy makers may do when they meet next month, according to a note from Santander's Stephen Stanley. The unrounded core CPI posted a 0.215% rise, which translates to a 2.6% annualized pace, he points out in a note. "Given what we know now, I continue to expect the FOMC to hike in September (and again in December)," he says.(jessica.coacci@wsj.com)

1014 ET - Sterling rises to a four-week high against the dollar after U.S. inflation data on Wednesday prompted markets to trim expectations for the Federal Reserve to raise interest rates in September. Annual U.S. inflation eased to 3.4% in July from 3.5% in June, as expected. Money markets price a 39% chance of a 25 basis-point U.S. rate rise in September, compared to 48% before the data, according to LSEG. Sterling rises to a high of $1.3541 after the data, from $1.3518 beforehand, LSEG data show. (renae.dyer@wsj.com)

1001 ET - Gold futures are higher, and may move up more on the back of a tame July inflation reading. The CPI came in at 3.4%, reducing investor expectations on the likelihood of a rate hike in September. "We anticipate prices rising above the $4,500 [per troy ounce] level, enhancing the prospects for a stronger rally, with gold potentially reaching new record highs by year-end," says Peter Cardillo of Spartan Capital Securities in a note. Gold rises 0.8% to $4,478/oz. (kirk.maltais@wsj.com)

1000 ET - Government bonds from peripheral countries in the eurozone, such as Italy and Spain, look attractive as they are high-quality assets with potential to provide carry returns, Pimco's Konstantin Veit and Nicola Mai say in a note. Spain and Italy's debt ratios have improved in recent years, making their bonds attractive, the portfolio managers say. "We maintain our positive outlook on sovereign bonds from peripheral countries, particularly with regard to liquid markets such as Italy and Spain." (miriam.mukuru@wsj.com)

0938 ET - The odds of an interest rate hike coming in September are shrinking, with the CME's FedWatch now assessing at 64% chance of rates staying the same after the Federal Reserve's meeting next month. This is expected to be beneficial for assets like bitcoin, says Stephen Coltman of 21shares. "Today's number will only reinforce that trend of a weaker dollar, a steeper yield curve, and a rally in assets such as gold and bitcoin," says Coltman in a note. Bitcoin is up 0.5% following the July CPI report, which showed inflation growing 3.4% year-over-year, matching the WSJ consensus. Ethereum is up 1.4%, solana rises 0.6%, and Hyperliquid climbs 3.2%. (kirk.maltais@wsj.com)

0935 ET - The moderation in U.S. inflation could reinforce the dollar's recent softening and a steepening Treasury yield curve--or the widening gap between short- and long-term Treasury yields--, 21shares' Stephen Coltman says in a note. Annual CPI inflation eased to 3.4% in July from 3.5% in June while core inflation dropped to 2.5% from 2.6%, in line with expectations in a WSJ survey of economists. The data probably won't end the debate over whether the Federal Reserve will raise interest rates in September but at the margin it strengthens the case against an increase, Coltman says. The DXY dollar index falls 0.2% to 99.674. The 10-year Treasury yield drops 2 basis points to 4.664% while the two-year yields falls 4.2 basis points to 4.176%, according to Tradeweb. (renae.dyer@wsj.com)

0916 ET - Projections for a rate hike at September's Fed meeting fall slightly, according to the CME's FedWatch tool. Investors now see a 42.1% chance of a 25-basis point hike, down from 48.4% Tuesday. Still, the July CPI report showed that core prices, which exclude the volatile food and energy categories, rose by 0.2% from the previous month. Policymakers monitor core inflation to ensure price pressures do not become more widespread. (jessica.coacci@wsj.com)

0906 ET - A July CPI reading that matched expectations is providing support for major cryptocurrencies, with bitcoin up 0.6% to $64,051, ethereum gaining 1.5% to $1,909, XRP rising 0.2% to $1.02, and solana advancing 0.8% to $76.62. While the inflation news is supportive for cryptocurrencies, the major focus continues to be institutional funds flowing into ETFs, says Sandeep Pyapali of Mesta in a note. "The inflation trend is still worth watching, but the more durable trade is the one moving corporate dollar flows off legacy rails and onto instant settlement--that shift doesn't pause for a CPI print," says Pyapali. (kirk.maltais@wsj.com)

0904 ET - Yields on U.K. and eurozone government bonds fall further after the release of the U.S. inflation data for July. Annual headline inflation decelerated to 3.4% in July from 3.5% in June, in line with the consensus forecast by economists in a WSJ poll. Annual core inflation eased to 2.5% from 2.6% in June. The data has led investors to lower their expectations of the U.S. Federal Reserve raising interest rates in September, causing bond yields to fall. Ten-year gilt yields last trade at 4.940%, down from 4.947% prior to the data release, Tradeweb data show. Ten-year Bund yields are down 1.2 basis points on the day to last trade at 3.136%. (miriam.mukuru@wsj.com)

0901 ET - Treasury yields hold mostly steady after July CPI comes in as expected. Consumer prices increased 3.4% year-over-year, down from 3.5% in June and in line with economists' views. The 2-year yield is at 4.178%, down slightly from 4.184% before the report's release. The 10-year yield is at 4.655%, up slightly from 4.648%. More data on price pressures will be available tomorrow from the PPI report, another inflation measure that feeds into the Fed's preferred inflation measure, PCE. (jessica.coacci@wsj.com)

0900 ET - The dollar extends its losses slightly and Treasury yields stay lower after data showed U.S. inflation eased in line with expectations in July. Annual inflation fell to 3.4% in July from 3.5% in June while core inflation dropped to 2.5% from 2.6%, as anticipated by economists in a WSJ survey. Money markets price the probability of the Federal Reserve raising interest rates in September at 39%, compared with 48% before the data, according to LSEG. The DXY dollar index falls to an intraday low of 99.641 after the data, from 99.785 beforehand. The 10-year Treasury yield falls 3 basis points to 4.653%, little changed from before the data, LSEG data show.