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

0752 GMT - Sterling could extend its losses after data Tuesday showed the U.K. jobs market remains cool and wage pressures subdued, suggesting little impetus for the Bank of England to raise interest rates this year, ING's Chris Turner says. Money markets continue to price 60 basis points of BOE rate rises into next year, LSEG data show. "That should slowly be priced out over the next three to six months, although energy prices will have a big say on timing," Turner says in a note. The July U.K. inflation report is due Wednesday where a lower services number would also argue against rate rises, he says. The euro rises 0.1% to 0.8556 pounds and ING sees it potentially reaching 0.8570-0.8580. (renae.dyer@wsj.com)

0742 GMT - The Japanese yen falls to a two-and-a-half-week low against the dollar as oil prices rise on renewed concerns about U.S.-Iran tensions. President Trump said he isn't seeking an extension of the 60-day U.S. ceasefire with Iran which expired Monday. He also threatened to bomb Oman as he claimed the Gulf nation might be standing in the way of a peace deal. Low foreign-exchange market volatility continues to weigh on the yen as this boosts demand for carry trades, where investors borrow in a low-yielding currency to invest in a higher-yielding one, ING's Chris Turner says in a note. The dollar rises as high as 159.77 yen, LSEG data show. (renae.dyer@wsj.com)

0734 GMT - Yields on U.K. government bonds, or gilts, climb, tracking rises in Treasurys and other developed-market peers, due to increasing concerns about a prolonged U.S.-Iran conflict. Fears about extended energy-supply shocks and high oil prices are intensifying inflation worries. This causes markets to expect that central banks could have to raise interest rates and raises concerns about potential long-term economic damage. U.K. 30-year gilt yields hit a 3-month high of 5.848%, LSEG data show. Ten-year gilt yields hit a 3.5-week high of 5.095%. (miriam.mukuru@wsj.com)

0708 GMT - The German 10-year Bund yield rises to a 15-year high of 3.249% in opening trade, as eurozone government bond yields increase together with U.S. Treasury yields. Rising U.S. government spending, pointing to a challenging fiscal outlook, are a key factor behind higher Treasury yields. Additionally, yields rise as a lack of progress towards a resolution in the U.S.-Iran conflict keeps oil prices high, intensifying inflationary pressures. "Progress towards normalising tanker traffic through the Strait of Hormuz has stalled, and Trump's threat of military action against Oman added to tensions," Danske's Filip Andersson says in a note. (emese.bartha@wsj.com)

0658 GMT - The rise in UK unemployment in June shows that the job market continued to weaken, says Ashley Webb, chief UK economist at Capital Economics. This supports the view that the job market isn't conducive of second-round inflation effects and the Bank of England won't raise interest rates from 3.75%, he adds. UK unemployment rose from 4.8% in the three months to May, to 4.9% in the three months to June and the single-month rate rose from 4.6% to 5.4%. All this paints a picture of a weak labor market that continues to loosen, he says. (james.glynn@wsj.com; X @JamesGlynnWSJ)

0656 GMT - The dollar recovers slightly as oil prices rise after President Trump said he is not seeking an extension of the U.S. ceasefire with Iran which expired Monday. Trump also threatened to bomb Oman if the Gulf nation "gets in the way." The news provides some support to the dollar due to its safe-haven role and America's position as a net energy exporter. It also increases the prospect of the Federal Reserve raising interest rates. However, markets are no longer fully pricing a rate rise by year-end after recent weak data. The recent scaling back of rate-rise bets sent the DXY dollar index to a 10-week low of 99.294 Monday. The index is last up 0.1% at 99.673. (renae.dyer@wsj.com)

0642 GMT - There's been a rush of good news for the New Zealand economy. For starters, inflation expectations have deflated like a balloon, meaning the Reserve Bank of New Zealand can move to the sidelines next year, pausing interest rate increases, says Jarrod Kerr, chief economist at Kiwibank. Recent positive manufacturing activity numbers for July were further good news, he adds. New Zealand's manufacturing index is above the long-run average and while the New Zealand dollar remains weak, that strength is likely to continue, he says. Still, in the interim the RBNZ will remain on track to hike the official cash rate to 3% soon enough, he adds. (james.glynn@wsj.com; X @JamesGlynnWSJ)

0637 GMT - Sterling falls modestly after data showed the U.K. unemployment rate unexpectedly held steady and the number of payrolled employees fell in the three months to June. The unemployment rate remained at 4.9%, above the 4.8% forecast by economists in a WSJ survey. Payrolled employees fell 86,000 compared to a year ago. Average earnings, excluding bonuses, rose 3.5% in the quarter, against an expected 3.4%. The labor market has been loosening for some time which supports the case for the Bank of England to keep interest rates steady for the rest of the year, Aberdeen's Felix Feather says in a note. Sterling falls 0.1% to $1.3519 after the data, from $1.3537 beforehand. The euro rises 0.1% to 0.8554 pounds from 0.8547. (renae.dyer@wsj.com)

0629 GMT - The DXY edged higher toward 99.7 points in Asia. Fading expectations for U.S. Federal Reserve interest rate hikes have recently weighed on the U.S. dollar. Markets are now pricing a 37% chance of a September hike, down from roughly 70% in late July, says Samara Hammoud, FX strategist at CBA. Still, international capital data for June this week showed that foreigners continue to buy U.S. assets at a very high rate, she adds. CBA expects the U.S. exceptionalism narrative--especially the AI buildup--to continue to attract equity and foreign direct investment into the U.S. and push up the U.S. dollar this year. (james.glynn@wsj.com; X @JamesGlynnWSJ)

0629 GMT - Nordic markets are seen opening slightly lower, with IG calling the OMXS30 down 0.4% at around 3253. Stock prices turned lower Monday in both Europe and the U.S., where the weaker U.S. retail sales figure from Friday reinforced a gloomier mood, SEB economist Marcus Widen writes. Most equity markets in Asia are also lower. "Long-term bond yields continue their upward journey and we see levels we have not seen for many, many years," Widen says. The rise in yields comes despite the market scaling back Fed interest-rate expectations as new signs of a cooler economy emerge. Oil prices continue to rise after the fragile ceasefire between the U.S. and Iran ended yesterday. OMXS30 closed at 3266.30, OMXN40 at 2711.24 and OBX at 2015.86. (dominic.chopping@wsj.com)

0603 GMT - The Australian dollar likely has scope to rise further against its U.S. counterpart, based on technical charts, says Quek Ser Leang of UOB's Global Economics & Markets Research in a report. The Australian dollar clearly broke above the major resistance zone of US$0.7075-US$0.7090 on Monday, the senior technical strategist notes. However, "it remains to be seen if any advance can reach the next major resistance at US$0.7200," the strategist says, noting Monday's breakout didn't lead to follow-through usually associated with a clear break of key resistance levels. The Australian dollar is 0.1% lower at US$0.7097, LSEG data show. (ronnie.harui@wsj.com)

0557 GMT - The German Finance Agency is set to defy rising global government bond yields and go ahead with a planned syndicated tap of the existing August 2056 Bund. Commerzbank strategists expect a tap size of around 3.5 billion euros. The announcement of the transaction came Monday, somewhat earlier than expected by many in the market. In the eurozone, usually Finland is the first country to deliver a post-summer syndicated bond issue. "In primary [market], the DFA [German Finance Agency] surprised by announcing a syndicated 30-year tap already for this week," Commerzbank's Christoph Rieger says in a note.