Bitcoin Eases Further as Part of Market Correction — Market Talk

0709 GMT - Bitcoin continues to ease from last week's all-time high as part of a broader market correction that aligns with fluctuations in risky assets, Deusxpay trader James Madden says in a note. Bitcoin's pullback isn't anything out of the ordinary for crypto assets, he says. "What's more telling is that as retail investors panic and sell their positions, institutions are stepping in, with major players like Metaplanet making substantial buys." This could signal that bitcoin's decline is viewed as an opportunity to accumulate the cryptocurrency, he says. Bitcoin falls 1.2% to $115,070 after earlier hitting a nearly two-week low of $114,485, LSEG data show. It reached a record high of $124,480 on Thursday.(renae.dyer@wsj.com)

0644 GMT - The dollar trades steady as markets assess the latest efforts to resolve the Ukraine-Russia conflict. Ukraine President Volodymyr Zelensky and European leaders met with President Trump in Washington Monday for talks. Zelensky said talks were positive and covered sensitive matters including security guarantees. He said he was ready to meet Putin bilaterally. "However, it remains to be seen whether real progress has been made towards a ceasefire or even peace in Ukraine," Commerzbank's Volkmar Baur says in a note. The currency market remains unimpressed and largely unchanged as Russian President Vladimir Putin is unwilling to deviate from his demands while Trump seems to be losing interest, he says. The DXY dollar index trades flat at 98.124. (renae.dyer@wsj.com)

0623 GMT - U.S. Treasurys are in high demand amongst foreign investors, but eurozone government bonds continue to offer value as a robust hedge for future turmoil, ING's Padhraic Garvey and Michiel Tukker say in a note. "U.S. Treasurys are still the more established safe assets, but to hedge against all possible scenarios, Bunds may have turned into the better bet," the strategists say. The 10-year U.S. Treasury-German Bund yield spread is 157 basis points, having narrowed from around 220 basis points at the beginning of the year, according to LSEG data. (emese.bartha@wsj.com)

0606 GMT - U.S. Treasury yields are little changed in Asian trading, having risen marginally on Monday, with investors' focus on geopolitics and the Federal Reserve's coming Jackson Hole Symposium. In particular, Fed Chair Jerome Powell's speech is awaited for signals on the central bank's policy path. "A pretty light docket today, as we wait for Powell on Friday, and as both trade and geopolitical tensions remain in focus," says Pepperstone's Michael Brown in a note. The two-year U.S. Treasury yield eases 0.6 basis point to 3.766%; the 10-year Treasury yield is flat at 4.338%, while the 30-year yield drifts 0.7 basis point lower to 4.935%, according to LSEG. (emese.bartha@wsj.com)

0606 GMT - The People's Bank of China is unlikely to cut policy rates for the rest of the year, according to BofA economists in a research note. The PBOC has shown little indication of imminent broad-based easing following July's weak credit data, they say. Instead, it showed a strong focus on structural credit support aimed toward small-and medium-sized enterprises, technology, and consumption in its recent report, the economists point out. Future policy moves will depend on incoming data, they say. (tracy.qu@wsj.com)

0606 GMT - ​The outcome of the upcoming Jackson Hole symposium is likely not what the market expects, says Russell Investments' Paul Eitelman in a note. Federal Reserve Chair Jerome Powell's comments at Jackson Hole may be less dovish than the market anticipates, the global chief investment strategist says. "The chair weighs a divided FOMC and crosscurrents from downside risks to employment and upside risks to inflation," Eitelman says. Russell Investments considers an interest-rate cut by the Fed in September as "likely," not "definite", and it would be 25 basis points rather than 50 basis points. (emese.bartha@wsj.com)

0604 GMT - JGBs extend price declines in Tokyo's afternoon session after the Japanese Finance Ministry's auction earlier today of 20-year sovereign debt drew somewhat weak demand from investors. The bid-to-cover ratio, a key measure of demand, stood at 3.09, below the bid-to-cover ratio of 3.15 at July's 20-year JGB sale. A lower ratio indicates weaker demand. Following today's auction, yields on 10-year JGBs are up 2 bps at 1.590%, those on 20-year sovereign debt are 2.5 bps higher at 2.600%, and yields on 30-year government bonds are 1.5 bps higher at 3.130%. (ronnie.harui@wsj.com)

0603 GMT - The Bank of Korea could raise its 2025 economic growth forecast marginally and stand pat on interest rates at its policy meeting due next week, Citigroup economist Jin Wook Kim says in a note. Kim expects the BOK to increase its GDP growth projection to 0.9% from 0.8% forecast in May, as well as raise its headline inflation forecast to 2.0% from 1.9%. The expected uptick would reflect better-than-expected macroeconomic data and diminishing U.S. tariff uncertainties following a trade deal between Seoul and Washington, he says. The BOK may prefer to wait and see before potentially cutting rates at its October meeting, he adds. (kwanwoo.jun@wsj.com)

0553 GMT - Thailand's full-year economic growth won't slow as much as Citi previously expected, with the bank nudging up its 2025 growth forecast to 2.2% from 2.1%. The Thai economy expanded 2.8% in 2Q. Citi anticipates a "slightly gentler slowdown" in growth at 1.4% in 3Q and 1.3% in 4Q, compared with 1.2% and 0.9% previously. Citi's Wei Zheng Kit partly attributes the revisions to Thailand no longer being at a disadvantage from much higher U.S. tariffs versus regional peers. 2Q front-loading of exports and higher U.S. tariffs could lead to a slowdown in exports from 4Q and into 2026, weighing on growth. He also anticipates private domestic demand to slow down thanks to softer tourism and manufacturing, and still-elevated household debt. Citi lowers its 2026 GDP growth forecast to 1.6%, from 1.9%. (megan.cheah@wsj.com)

0550 GMT - Metzler continues to see potential for the​ 2-10-year segment of the German government bond yield curve to widen to around 90 bps, even if the European Central Bank doesn't deliver another interest rate cut​, analyst Leon Ferdinand Bost​ says in a note. A look at past interest-rate cycles shows that curve steepening often continues even after interest-rate cuts have ended​, he says. The spread between the two- and 10-year German benchmark bond yields is 80.6 bps, according to Tradeweb data. (emese.bartha@wsj.com)

0534 GMT - ​The potential for further eurozone government bond yield spread tightening against Bunds has largely been exhausted with the approaching end of the E​uropean Central Bank's interest rate cut cycle​, Metzler's Leon Ferdinand Bost says in a note. Higher defense spending and the ongoing reduction of the ECB's balance sheet also suggest some pressure for spread widening, the analyst says. Metzler remains cautious over French government bonds, now sees little potential in Italy after significant tightening and turns attention to Spain. The 10-year Italian BTP-German Bund yield spread has reached Metzler's target level of 80 bps, the analyst says. (emese.bartha@wsj.com)

0524 GMT - Government bond supply in both the U.S. and Europe is set to increase significantly in the coming years due to high public budget deficits. This alone justifies a higher return requirement from investors in the bond market, say Danske Bank Research's Frederik Romedahl and Kirstine Kundby-Nielsen in a note. This has been reflected in a relatively weak demand for 10- and 30-year U.S. Treasurys at auctions in July, the analysts say. "We assess that long-term U.S. rates will need to adjust slightly higher in the near term, despite the Federal Reserve's resumption of rate cuts from September onwards," they say. (emese.bartha@wsj.com)