European session: Dollar eases, equities hold steady, yields edge up

Key headlines:

Markets overview:

• NZD tops the board, with USD and JPY trailing on the day
• 10-year Treasury yields rose 2.5 basis points to 5.11%
• WTI crude oil declined 0.3% to $96.20
• Gold gained 0.2% to $4,176
• European stocks moved higher; S&P 500 futures added 0.1%
• Bitcoin advanced 0.7% to $82,577

Trading was relatively subdued as markets absorbed the calmer tone heading into the end of the week.

The bond market sell-off has paused in recent days, even after US inflation came in hotter than anticipated, providing investors with some relief. That respite is largely carrying over into today's session.

10-year Treasury yields have edged back up slightly to 5.11%, but the broader market reaction remains on the calmer side so far. Yields are still on track for back-to-back weekly declines for the first time since June.

The dollar is under pressure again as the week winds down. EUR/USD rose 0.3% to 1.1256, hitting a one-week high. USD/JPY stayed relatively stable, little changed near 158.00, but the greenback weakened elsewhere: AUD/USD climbed 0.6% to 0.6960, and USD/CAD fell 0.3% to 1.4147.

In equities, European stocks extended the improved sentiment, with regional indices posting modest gains for the day. The DAX rose 0.9%, while the CAC 40 added just 0.3% as French shares showed less enthusiasm due to domestic fiscal concerns. Still, both indices are set to record their fifth weekly gain in six weeks.

For US futures, the tone remains rather downbeat for technology stocks. S&P 500 futures are up 0.1%, but Nasdaq futures are down 0.2%, as the tech selloff appears to persist despite the late recovery in the previous session.

Elsewhere, gold rose 0.2% to $4,176, maintaining its rebound after the CPI release but still unable to breach key resistance near $4,200.

The calendar is light for the remainder of the session, leaving markets to continue digesting the week's inflation data and weighing it against the "higher for longer" narrative, as central bank decisions gradually return to focus in the weeks ahead.