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

1049 ET - The dollar remains the most reliable defensive currency during selloffs in equities and bonds, BNY strategist Geoff Yu says in a note. The U.S. currency is bolstered by its global reserve status and relatively high U.S. real yields adjusted for inflation, he says. During three recent episodes of simultaneous bond and equity stress, the Swiss franc, Singapore dollar and euro--key alternative safer currencies--tended to weaken or perform well only intermittently against the dollar, BNY research shows. "There is little evidence that any major non-dollar currency provides a reliable hedge," Yu says. BNY suggests maintaining dollar exposure for protection, using the Swiss franc, Singapore dollar and euro "selectively as secondary defensive positions." (renae.dyer@wsj.com)

1047 ET - Tensions between Saudi Arabia and the United Arab Emirates are increasingly spilling into the economic sphere, says Jason Tuvey, deputy chief emerging markets economist at Capital Economics. Saudi Arabia's tighter oversight of financial transactions involving the U.A.E. is best viewed through the broader geopolitical tensions between the two countries, rather than solely through concerns over Emirati ties with Iran, he says. Tuvey expects the direct economic impact on Saudi Arabia and the U.A.E. to remain relatively small even if restrictions broaden, but says the consequences could be larger elsewhere in the region as the two countries compete for influence. (farhan.rafid@wsj.com)

1036 ET - The Bank of England could reduce the volume of long-dated gilt sales or stop the sale of the long-maturity gilts under the quantitative tightening program, Deutsche Bank's Sanjay Raja and Maui Brennan say in a note. The BOE's long-dated gilt sales have seen lower bid-to-cover ratios--a measure of investor demand--, they say. Reduced demand for long-dated gilts is likely to cause the BOE to adjust its sales strategy in the 12-month period starting in October, the economists say. (miriam.mukuru@wsj.com)

1018 ET - Details emerging about the tentative trade pact between the U.S. and Canada means "a green light for growth" for America's northern neighbor, says Derek Holt, economist at Bank of Nova Scotia. Based on some details emerging, per reporting by WSJ and other outlets, Holt calculates the overall tariff rate on U.S.-bound Canadian exports would be 3.7%, compared to the present 5.5% level. On a global basis, the total tariff rate on all Canadian exports drops to 2.8%. The rates were much lower prior to President Trump's second term, Holt says. Still, the result "is next to nothing by way of an incremental overall tariff burden," and rates that "vastly lower" than what the US is applying against other countries. He envisages two Bank of Canada rate hikes in 4Q. (paul.vieira@wsj.com; @paulvieira)

1002 ET - The Swedish krona falls to a near four-week low against the euro as the Riksbank's policy decision Thursday didn't provide any new information, Commerzbank's Michael Pfister says. Sweden's central bank left rates unchanged at 1.75% and said a rate rise later this year remains a possibly, but this "essentially reiterated what they said last time," he says. "Some market participants were hoping for two rate hikes this year, this is probably now off the table." Moreover, higher oil prices and risk aversion are probably weighing on the krona amid ongoing U.S.-Iran tensions, he says. The euro rises 0.6% to a high of 11.0877 krona, LSEG data show. (renae.dyer@wsj.com)

0956 ET - The Swiss franc and Japanese yen could lag a broad rally against a weaker dollar as the U.S. Treasury's buyback announcement improves risk appetite, ING analyst Chris Turner says. The move suggests the Treasury is prepared to take action to support the bond market, he says. This also reduces volatility, supporting carry trades where investors borrow in low-yielding currencies like the franc and yen to purchase higher-yielding currencies. While the franc has rallied on positioning adjustments, it should "ultimately lag" even more than the yen due to the threat of further U.S.-Japanese currency interventions, he says. The dollar fell to a two-month low of 0.7947 francs and a 10-day low of 158.00 yen earlier, LSEG data show. (renae.dyer@wsj.com)

0944 ET - San Francisco Fed President Mary Daly told Bloomberg TV it was early days and she wouldn't want to preemptively discuss how the Treasury's debt management moves, including its issuance strategy could affect the Fed. "I wouldn't want to be preemptive in sort of discussing those types of things until we've had a chance to think through those issues," she said. Daly said the Fed will find a way to achieve its dual mandate goals. "I think we don't want to worry about the mechanics of how to do that as much as the commitment to achieve it," she said. (jessica.coacci@wsj.com)

0908 ET - The proportion of U.S. job displacements by AI remains fairly small, but this trend is becoming increasingly noticeable, Morgan Stanley economists say in a note. AI displacement is adding at most around 15 basis points to the U.S. unemployment rate as of June 2026, an increase from 10 basis points in December 2025, they say. "Disruption signs remain most pronounced among younger workers," they say. (miriam.mukuru@wsj.com)

0856 ET - Canada avoided disaster with its tentative trade deal with the U.S. but the pact can't be described as a win, says David Rosenberg, head of Toronto-based market-strategy firm Rosenberg Research. Rosenberg says Canada avoided the threat of a 50% tariff on about $20 billion of its U.S.-bound exports. Per reporting by the WSJ, the U.S. is set to provide Canada sizable tariff relief on targeting steel, aluminum and autos. Bottom line, Rosenberg says, is that "Canada is now is paying tariffs it didn't pay two years ago, and giving up retaliatory measures ... in exchange for a reduction rather than a removal." He adds that, at best, some tail risks for Canadian economic growth have been partly removed. (paul.vieira@wsj.com; @paulvieira)

0838 ET - Treasury yields rise back to where they were before yesterday's announcement that the U.S. will buy back more of its own debt. The Treasury Department will double to $4 billion the limit of each repurchase operation of long-term bonds, starting next month. Yields plummeted on the news, but have been recovering as markets focus on Washington's ballooning fiscal deficit. The 30-year rises to 5.259% from yesterday's settle of 5.194%. The 10-year increases to 4.706% from 4.651% and the two-year is at 4.192%, up from 4.178%. (paulo.trevisani@wsj.com; @ptrevisani)

0823 ET - Bitcoin rises to an 11-week high, breaking above $70,000, after the U.S. Treasury's decision to increase buybacks of long-dated debt and President Trump urging Congress to pass key cryptocurrency legislation. The Treasury's announcement sparked a sharp drop in Treasury yields and improved broader risk appetite, Trade Nation's David Morrison says in a note. Trump asked lawmakers to pass a "fair version of the Clarity Act" which aims to establish a regulatory framework for digital assets and has stalled in the Senate. Bitcoin last trades up 4.1% to $71,896 after reaching as high as $72,373 earlier, according to LSEG. Ether rises 3.2% to $2,289 after hitting a three-month high of $2,326 overnight. (renae.dyer@wsj.com)

0803 ET - Small-business confidence in Canada remained relatively solid in August, based on a closely watched gauge from the Canadian Federation of Independent Business. The monthly Business Barometer dipped slightly to 57.6 in August, from 58.6. Still, the reading remains above 50 -- a threshold that indicates firms expect sales to accelerate over the next 12 months. Further, the survey was conducted before senior U.S. and Canadian officials signaled this week they are on the cusp of a trade pact that's said to provide tariff relief for Canadian firms. Firms surveyed suggested they intended to raise prices over the year by 2.7%, unchanged from the prior month, which is down from an April peak of 3.2%. And for the first time since March, a greater share of firms identified wages over energy prices as the biggest driver of input expenses.