- US Energy Dept cancels US$200mn grant to lithium battery company over alleged China links
- More on central banks, governments rigging Libor, and then jailing scapegoat traders
- Chinese tabloid says there is no basis for long-term yuan depreciation
- UBS warns that credit & growth negatives not being adequately reflected in rising equities
- PBOC sets USD/ CNY central rate at 7.0326 (vs. estimate at 7.0327)
- White House debt limit negotiators returning to Capitol Hill to resume (staff level) talks
- Japan preliminary PMI for May: Manufacturing 50.8 (prior 49.5), Services 56.3 (prior 55.4)
- PBOC is expected to set the USD/CNY reference rate at 7.0327 – Reuters estimate
- US President Biden on talks with McCarthy - we reiterated that default is off the table
- Republican negotiator McHenry says he sees a “lack of urgency” from the White House.
- Australian weekly Consumer Confidence survey 77.9 (prior 75.9)
- Chinese financial media says LPRs (PBOC loan rates) likely to stay unchanged for some time
- US McCarthy after meeting with Biden - say no debt limit agreement yet
- Australian preliminary PMIs: Manufacturing 48.0 (prior 48.0) Services 51.8 (prior 53.7)
- Morgan Stanley on the US equity rally - says it's a "head fake"
- JPMorgan CEO Jamie Dimon urges markets to brace for potentially higher interest rates
- Fed's Kashkari says it way too early to declare the 'all clear' on banking problems
- BlackRock has downgraded its view on credit, from overweight to neutral
- Forexlive Americas FX news wrap 22 May: Fed official weigh in as markets await a debt deal
- PBOC left rates unchanged, but Goldman Sachs expect some movement from the Bank in June
- US Treas Sec Yellen reaffirms June 1 as the “hard deadline” to raise the debt ceiling
- A barbell close for the major indices again
- ANZ rank the New Zealand dollar higher than the AUD for the week
- Trade ideas thread - Tuesday, 23 May 2023
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: