Bitcoin Falls as Fed Rate-Cut Hopes Fade — Market Talk

0411 GMT - Bitcoin falls in Asian trading. Fading expectations for Fed rate cuts and persistent U.S. inflation concerns continue to weigh on demand for crypto assets, Novaque Research analysts say. Meanwhile, bitcoin could face more selling pressure as more leveraged traders bet on long-term gains while additional bitcoin supply enters the market. If prices fail to rise, these traders may be forced to deleverage, potentially triggering another wave of selling, Novaque adds. Bitcoin is down 0.2% at $64,253.50. ([email protected])0408 GMT - Taiwan's sticky inflation strengthens the case for a September interest rate hike, says ING economist Lynn Song in a note. Taiwan's inflation has been above the 2% target for a few months, after rising 2.54% in July, and the economy has maintained robust growth. Barring a significant cooling in the August data, the economist suggests both economic activity and inflation provide a compelling argument for a hike when the central bank meets next in September. An unexpected rate increase by the U.S. Federal Reserve in September, which isn't currently part of ING's base case, could further pressure Taiwan's central bank to tighten policy, he adds. ([email protected])0357 GMT - Recent coordinated FX intervention by Japan and the U.S. support BofA Global Research's bullish view on the yen. "The signaling effect of this rare, coordinated intervention is significant," the strategists say in a note. "The primary long-term goal of the Japanese and the U.S. governments should be to restore credibility and stabilize JPY," they say. "Coordination implies that Japan and the U.S. have agreed on a common objective and a plan to achieve it," the team adds. Because of factors including higher probability of faster BOJ rate increases, BofA cuts its dollar-yen forecasts to Y153 from Y154 for 3Q and to Y149 from Y152 for year-end. Dollar is little changed at Y158.42. ([email protected])0318 GMT - The Singapore dollar strengthens slightly against its U.S. counterpart ahead of the U.S. nonfarm payrolls report due later Friday. "Some look for smaller gains in job creation," in line with the Fed decision to hold rates in July and perhaps justifying a dovish tone of Fed Chairman Kevin Warsh at a recent presser, Maybank analysts say in a report. The U.S. dollar is 0.1% lower at S$1.2824. ([email protected])0217 GMT - The Reserve Bank of Australia is on track to leave interest rates on hold at its policy meeting next week. However, it is expected to remain hawkish, with warnings that further interest rate increases can't be ruled out. It's too early in the cycle for the central bank to back off fully, especially given that inflation remains above target. There is still some risk that core inflation doesn't fall fast enough and that the RBA chooses to hike again in 2H of 2026, says Paul Bloxham, chief economist at HSBC. The RBA board's tolerance for upside surprises will be low, he says.([email protected]; X @JamesGlynnWSJ)0207 GMT - U.S. nonfarm payrolls report due out Friday could shape the dollar's next move, StoneX's Matt Simpson says in commentary. The reading is being closely watched as it could determine whether markets price in a greater or lesser than 50% chance of a Fed rate increase in September, says the market analyst. Fed funds futures have recently trimmed expectations for two rate increases by December, with the probability of a September rate hike hovering at 54.6% at Thursday's close, he notes. "If the report undershoots expectations, it could further reduce those odds and weigh on the U.S. dollar," the analyst adds. The U.S. Dollar Index is flat at 99.948, LSEG data show. ([email protected])0133 GMT - The Reserve Bank of Australia will likely leave the official cash rate at 4.35% at next week's policy meeting withno more rate increases this year, says ANZ in a note to clients. Relative to the RBA's May forecasts, inflation has been a little weaker than expected while the unemployment rate has been a little higher, ANZ notes. These developments support an on-hold decision, although the RBA will retain a hawkish bias and keep open the possibility of further tightening. The RBA's trimmed mean inflation forecast should be slightly lower for 2026 than it was in May, ANZ adds. ([email protected]; X @JamesGlynnWSJ)0115 GMT - Asian government bonds fall in price terms amid rising oil prices, which typically spur inflation and could prompt central banks to raise rates further. Global yields are moving higher, supported by firmer oil prices as optimism over a reopening of the Strait of Hormuz fade, OCBC Group Research says in a note. OCBC cites media reports suggesting a proposed Iran-Oman shipping arrangement falls short of a full reopening of the strait. Yields on Japan's 10-year government bonds rise 2 bps to 2.780%, that on Australia's 10-year sovereign securities climb 5 bps to 4.9690%, and those on New Zealand's 10-year government debt gain 3 bps to 4.7080%. ([email protected])0021 GMT - Japanese stocks are lower in early trade as uncertainty over the Middle East conflict and energy costs persist. Chip-related stocks are leading the declines. Lasertec is down 9.8%, SoftBank Group is down 6.1% and Screen Holdings is 4.2% lower. The dollar is at 158.49 yen, compared with Y157.81 as of Thursday's Tokyo stock market close. Investors are focusing on earnings, with Bridgestone scheduled to announce its quarterly results later Friday. The Nikkei Stock Average is down 0.7% at 65210.13. ([email protected]; @kosakunarioka)0013 GMT - Asian currencies consolidate against the dollar ahead of the U.S. non-farm payrolls report due later today. The "report can influence market pricing for the Federal Reserve," CBA's Kristina Clifton says in a research report. "We judge the market is pricing in too few interest rate hikes for the Fed," the senior economist and senior currency strategist says. "Ultimately we expect interest rate differentials to move against" the Australian dollar versus its U.S. counterpart, Clifton adds. The Australian dollar is little changed at US$0.7029 while the U.S. dollar is flat at 158.45 yen, LSEG data show. ([email protected])0005 GMT - JGB futures fall in early Tokyo trade, tracking overnight price declines in U.S. Treasury market. Both JGBs and Treasurys tend to move in tandem. JGB prices may also be weighed by latest rise in crude oil prices and weakness of the yen, both which typically lead to higher inflation in Japan and might spur the Bank of Japan to raise rates at a faster pace. However, investors are likely to focus on the U.S. non-farm payrolls report due today and watch for any implications for the Fed's monetary-policy trajectory. Benchmark 10-year JGB futures are 0.30 yen lower at 127.05 yen. ([email protected])2342 GMT - Japanese stocks may remain rangebound as uncertainty over the Middle East conflict and energy costs continues. Nikkei futures are up 0.3% at 65740 on the SGX. The dollar is at 158.42 yen, compared with Y157.81 as of Thursday's Tokyo stock market close. Investors are focusing on earnings, with Bridgestone set to report its quarterly results later Friday. The Nikkei Stock Average fell 0.9% to 65683.26 on Thursday. ([email protected])