Asian markets spent another session fretting over US debt limit talks and developments. In the thin ‘twilight zone’ between US regular trading hours close and Japan’s open US President Biden and House Speaker McCarthy once again held talks. Comments from Biden and McCarthy at the meeting’s conclusions were optimistic, saying progress was made and default is ‘off the table’ but there was very little of substance and no sign of agreement. Staff level talks recommenced a little after the leaders’ meeting concluded.

There wasn’t a lot else of news nor data. We did get flash PMIs from Australia and Japan. Both the manufacturing and services PMIs from Japan showed improvement.

Across major FX it ranges were small only and net change on the session also small. USD/JPY added to its overnight gains. Gold dropped away a little.

Asian equity markets:

  • Japan’s Nikkei 225 +0.6%

  • China’s Shanghai Composite -0.7%

  • Hong Kong’s Hang Seng -0.2%

  • South Korea’s KOSPI +0.7%

  • Australia’s S&P/ASX 200 +0.2%

USD/JPY up a touch further after its Monday rally:

usdyen wrap chart 23 May 2023