• Biden says his talk with McCarthy went well, will speak again Monday (US time)
• UK Times reports coordinated manipulation by central banks to rig Libor
• Goldman Sachs are not expecting major Chinese policy stimulus to spur economy
• US Commerce Dept firmly opposes Chinese bans that have no basis in fact
• Almost half of medium-sized British companies plan to delay investment plans
• PBOC Loan Prime Rates (LPR) remain unchanged at today’s rate setting, as expected
• PBOC sets USD/ CNY reference rate for today at 7.0157 (vs. estimate at 7.0141)
• White House official says teams will keep working on debt ceiling issues Sunday night
• Nomura is looking for a stronger US dollar in the near term
• Japanese capex leading indicator (machinery orders) fell m/m in March
• Goldman Sachs expect a pause at the June Federal Open Market Committee (FOMC) meeting
• Barclays wary of S&P500 bullishness – citing mega cap inflation
• Fed’s Kashkari is open to a June FOMC rate hike pause, but not convinced done yet
• Reserve Bank of New Zealand Shadow Board splits over rate hike this week, 0bp vs. 25 vs 50
• BoA says the S&P500 is a sell – buyers being ‘sucked in’ ahead of a hard landing
• US debt limit negotiators have recommenced talks
• Trade ideas thread – Monday, 22 May 2023
• Goldman Sachs says debt limit drop dead date is June 8 or 9
• US Treas Sec Yellen reaffirmed June 1 as the “hard deadline” to raise the debt ceiling
• China bans Micron products, cites “significant security risks” to “national security”
• Lagarde: ECB not done yet, not pausing, “inflation outlook is too high and for too long”
• Monday morning open levels – indicative forex prices – 22 May 2023
• Newsquawk Week Ahead: Highlights include FOMC mins, US PCE, RBNZ, Flash PMIs
• Tesla Stock Price Forecast: Technical Analysis and Trade Idea for Bulls (using Fib entry)
• Biden in Japan. In Washington D.C, Democrats & Republicans say debt talks going backwards.
• Forexlive Americas FX news wrap 19 May: Debt ceiling talks stall. Powell picks his words.

The
ups and downs of US debt limits talks continued over the weekend,
swinging from optimism to pessimism and back again and points in
between. During the session here since FX, Globex and Asian markets
have been trading the arrow has moved towards optimism. There have
been talks between staff of both sides at the White House on Sunday
and the groundwork has been laid for those to continue and for the
White House to
host
a meeting between President Joe Biden and House Speaker Kevin
McCarthy on
Monday. The ‘Risk’ trade has inched a little higher during the
session here.

From
China today we saw the People’s Bank of China maintain
its benchmark lending rates, the
Loan Prime Rates (LPRs), at the same level for the ninth consecutive month in line with
market forecasts. China’s five-year LPR remained at 4.30% and
its one-year LPR was held
at 3.65%.

You’ll
note the other news of significance from China in the points above,
the Cyberspace Administration of China (CAC) said U.S. memory chip
manufacturer Micron Technology products had failed its network
security review. It has banned products made by Micron from use in
key infrastructure. The US Commerce Dept. has objected.

Asian
equity markets:

• Japan’s Nikkei 225 +0.1%

• China’s Shanghai Composite +0.5%

• Hong Kong’s Hang Seng +1.6% Chip stocks gained on the Micron ban

• South Korea’s KOSPI +0.9%

• Australia’s S&P/ASX 200 -0.3%

China’s yuan was not a lot changed on the session after Friday’s move:

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