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Breakfast Bites - Fri May 12, 2023

Rise and shine everyone.

Happy Friday.

It’s a quiet Friday. A few bits of news here and there. The Debt Ceiling still seems to be the major concern for now with Janet Yellen urging Congress to raise the ceiling. The proposed Debt Ceiling meeting in Washington to be held today has been postponed to next week.

US Futures are trading marginally higher this morning. The US Dollar is also higher, as are rates. Copper has recovered slightly from yesterday’s lows, while Gold, Oil and Bitcoin continue to see pressure. Bitcoin is now below $27,000.

Asia and Australia

  • Asian Markets close mixed. Japan, Australia and India closed higher while China, Hong Kong and South Korea saw selling pressure. China was down -1.3%.

  • Japan workers set to receive biggest pay raises in 31 years. A Nikkei survey of 308 Japanese companies showed average wages set to rise 3.89% in 2023, accelerating 1.54 ppt from last year.

  • New Zealand Q1 2Y inflation expectations fell to 2.79% from 3.30%, lowest since Sep-2021.

  • Bloomberg reported three Adani Group companies considering raising between $3B and $5B to boost company balance sheets.

  • SoftBank poised to emerge from 'defense mode' with $38bn in coffers. They are eyeing investments in AI.

  • Slump in China bank loans, prices raise more worries about recovery, adds pressure on PBOC

Europe, Middle East, Africa

  • European markets higher today. Real Estate and Autos/Parts lag; Banks and Consumer Products/Services lead

  • ECB Vice President de Guindos, a moderate dove, remains concerned about services inflation as it has capacity to drive up wages

  • UK Preliminary Quarterly GDP reading came in at 0.10%; Monthly reading came in at -0.30%.

  • Food and drink price inflation in the UK hit 19.2% y/y in March, leaving headline inflation in double digit territory. With UK food price inflation at a 46-year high, ministers have launched an investigation into the country's food supply chain

The Americas

  • Tesla recalls over a million cars in China for a software upgrade

  • Fed's Bowman signals doubt over policy pause and warns no 'consistent evidence' that inflation is under control. Signals that the Fed may have to hike further.

  • Emergency liquidity borrowing from Fed little changed in latest week

  • FDIC proposes big banks pay a special assessment to cover bank-bailout costs

  • Money market assets hit new all-time high as rising short-term rates lure investors away from bank deposits

  • Debt ceiling standoff prompts investors to sell companies with outsized reliance on government contracts

  • Twitter appoints new CEO, while Elon Musk to remain at Chief Technology Officer


(news taken from Reuters, FT, Bloomberg; Calendar from Trading Economics)

No major earnings for today.


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