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

0233 GMT - The Bank of Thailand is expected to keep its policy rate steady at 1.00% on Wednesday, according to all 13 economists polled by The Wall Street Journal. The central bank is likely to reiterate its willingness to look through supply-driven inflation, while flagging concerns over weak domestic demand, Nomura economists say in a note. In 2Q, the economy grew 1.9% on year, compared to 1Q's 2.8% expansion. "The significant slowdown in [2Q] GDP also adds to BOT's concerns on the growth outlook and hence supports the case for an on-hold stance," Nomura says.(amanda.lee@wsj.com)

0219 GMT - The Bank of Japan may take the lead via rate increases as the primary tool for stabilizing the yen, three members of BofA Global Research say in research report. "To make the effects of FX intervention durable and achieve lasting yen stability, Japan ultimately needs a shift in its policy mix," the members say. "For now, the most plausible policy mix remains monetary tightening amid fiscal expansion," the members say. The BOJ is likely to raise rates at quarterly pace before ending rate-hike cycle at terminal rate of 2% in July 2027," they add. BofA's end-2026 forecast of dollar at 149 yen remains unchanged. The dollar is 0.1% higher at 159.27 yen. (ronnie.harui@wsj.com)

0150 GMT - The Philippines's fiscal metrics over the next two years will likely be supported by a gradual recovery in growth recovery and government fiscal consolidation efforts, Moody's Ratings says in a report. The government can tap domestic and international funding markets as well as sufficient foreign currency reserves to withstand global capital flow volatility. Although the country's near-term economic activity has slowed significantly, medium-term growth should continue to be supported by factors including favorable demographics and a gradual strengthening of investment as confidence recovers. Moody's maintains the Philippines's investment-grade credit rating with a stable outlook. (amanda.lee@wsj.com)

0104 GMT - Renewed trade uncertainty and the PBOC's preference for measured yuan appreciation may temporarily temper further gains in the currency, OCBC strategists say. The yuan's reaction to media reports that the U.S. is considering a 7.5% tariff on Chinese goods may add some uncertainty ahead of next month's Trump-Xi meeting, but reaction has been limited so far. Offshore levels remain close to recent lows against the dollar, suggesting markets don't see a major trade escalation risk yet. Dollar firmness overnight could further limit appreciation. OCBC sees mild bearish momentum on the daily chart intact, but doesn't rule out a modest rebound as the RSI indicator shows tentative signs of easing selling pressure. It pegs resistance at 6.74, with support at the 6.72 and 6.70 levels. Yuan is flat at 6.7203. (fabiana.negrinochoa@wsj.com)

0031 GMT - Asian currencies consolidate against the dollar as traders parse the U.S.'s new measures on Iran. Treasury Secretary Bessent said the U.S. is launching what he called "Operation Economic Outcast." "The targets are digital assets, technology, gold, aviation and shipping," CBA's Joseph Capurso says in a research report. "We do not expect China--Iran's largest trade partner--to bow to U.S. pressure to cease commerce with Iran," says the head of foreign exchange, international & geoeconomics. "The U.S.' campaign against Iran puts at risk the trade truce between the U.S. and China ahead of the leaders' meeting next month," Capurso adds. The U.S. dollar is little changed at 159.13 yen and is steady at 1.2699 Singapore dollars, LSEG data show.(ronnie.harui@wsj.com)

0013 GMT - JGB futures are mixed in the early Tokyo session, but may be supported by overnight price gains in the U.S. Treasury market. "Japanese and U.S. yields have recently become more closely correlated," SMBC Nikko Securities' Ataru Okumura says in a recent note. "UST yields are likely to face upward pressure from AI boom-driven strength in business sentiment, inflationary pressure, and fiscal concerns," the chief Japan rates strategist says. "In Japan, fiscal developments could re-enter the spotlight as ministries gradually unveil their requested budgets for FY27," Okumura adds. September 10-year JGB futures contract is 0.05 yen lower at 126.54 yen, while December contract is 0.03 yen higher at 125.94 yen. (ronnie.harui@wsj.com)

0011 GMT - Japanese stocks are lower after U.S. technology shares fell overnight. Chip and other electronics stocks lead declines. Kioxia Holdings falls 2.8%, Advantest is 3.6% lower and Panasonic Holdings is down 4.0%. The dollar is at 159.13 yen, compared with Y158.94 as of Monday's Tokyo stock market close. Investors are closely watching the Iran war and crude oil prices after Treasury Secretary Scott Bessent said the U.S. is launching a new campaign to isolate the Iranian regime. The Nikkei Stock Average declines 0.8% to 64980.53. (kosaku.narioka@wsj.com; @kosakunarioka)

2348 GMT - Japanese stocks may fall after U.S. technology stocks dropped overnight. Continued uncertainty over the Middle East conflict may also weigh on the market. Nikkei futures are down 0.3% at 65280 on the SGX. The dollar is at 159.11 yen, compared with Y158.94 as of Monday's Tokyo stock market close. Investors are focusing on the Iran war and crude oil prices after Treasury Secretary Scott Bessent said the U.S. is launching a new campaign to isolate the Iranian regime. The Nikkei Stock Average fell 0.7% to 65528.09 on Monday. (kosaku.narioka@wsj.com)

2327 GMT [Dow Jones]--Higher borrowing costs beget higher yields, especially without a credible fiscal plan, says Sonali Basak, chief investment strategist at iCapital. Fiscal credibility is crucial to compressing the term premium, which has steadily widened over recent months, demonstrating that inflation expectations alone aren't driving the selloff at the long end of the curve, she says. Net interest outlays, one reflection of how much higher yields are causing a greater dent in U.S. budget shortfalls is already a meaningful part of the total U.S. deficit, and expected to grow closer to 5% of GDP by the end of the next decade, she says. (james.glynn@wsj.com; X @JamesGlynnWSJ)Australia's housing downturn is underway. Higher interest rates and tax changes have made property less attractive. Prices are likely to fall further. Even so, national house prices are unlikely to fall far during this cycle, says Nerida Conisbee, chief economist at property group Ray White. The downturn is not occurring evenly, she says. If prices keep falling at their recent rate for another nine months, only then would the annual decline reach 7.9% and become comparable with the Global Financial Crisis in 2008, she says. The GFC downturn occurred during a global credit shock. The current market is markedly different, she adds. (james.glynn@wsj.com; X @JamesGlynnWSJ)The Reserve Bank of New Zealand is likely to raise the official cash rate a further 25 basis points at its policy meeting on Sept. 2, taking it to 2.75%, says Sharon Zollner, chief economist at ANZ. A third rate hike in October is roughly a 50/50 likelihood, she adds. Beyond that, it wouldn't be a surprise to see something like the bank's May OCR forward track implying risks that are tilted toward it going higher than 3%, but that it is far from a certainty. The market is pricing over a 90% chance of a hike at this meeting but is on the fence as regards a follow-up in late October, Zollner adds. (james.glynn@wsj.com; X @JamesGlynnWSJ)U.S. bonds are cheaper than they have been in years. But wait, they are still not cheap enough, says Barclays in a note to clients. The only reason to be a bond bull right now is if you believe a sharp economic pullback is coming - a collapse in growth, a financial accident, or a shock severe enough to force the Fed back into cutting mode. That is always possible. But it is not Barclay's base case, and it is not what the data is pointing too. Every data point suggests that 10-year yields are still not high enough to compensate for upside risks, the bank adds.