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The market is still largely reacting to news on the US debt limit. There is still a lot of uncertainty, but McCarthy believes there is a chance of an agreement before June 1. On the other hand, Graves of the Republicans, as one of the negotiators, indicates that the talks are not moving in the right direction. McCarthy, on the other hand, says that he has not yet met with Biden today. He also stresses that work will continue until the crisis is resolved
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US bond yields continue to rise. Yields on 10-year bonds maturing after 1 June are at 5-6%. Despite the high yields, gold managed to return to green territory today and was trading above $170 per ounce. Silver limited declines from -1.5% to -0.5%.
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According to US experts, June 1 is the contractual date for a potential US bankruptcy. In all likelihood, the US may not face default until 8-9 June, while surviving until 15 June, when a large tax take will occur, will push the X-date to July or even later
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The European PMI indices performed quite mixed: mostly disappointing, with the industrial sector remaining below 50 points and falling below expectations. The indexes for services, however, remain above expectations. The service sector in Germany scores a strong rebound, while France is slightly worse off. Composite indices point to economic recovery in the second quarter of this year
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In the US, the publications performed very similarly: the industrial PMI falls below 50 points, while the services PMI continues to rise above 50 points.
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On the other hand, the Richmond regional index falls to -15 points from -10 points, showing further weakness regionally
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Powell met with the Democrats today, but the meeting was pre-planned and had nothing to do with the recent debt limit crisis
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Lagarde stressed that there is a need to fight inflation and that interest rates have not yet reached heavily restrictive levels and will remain at high levels for some time to come
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Iraq indicates it is determined to maintain OPEC cuts, while Saudi Arabia warns speculators against overselling oil. According to Bloomberg data, net positioning on both benchmarks on contracts and on options is reaching the closest levels since 2011. Crude oil today was at its highest since 10 May and both benchmarks gained more than 1.5% today
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According to the IMF, the UK economy will avoid recession this year. Bailey sounded slightly hawkish today, which helped limit losses on GBPUSD
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The DAX lost 0.44% today, while the CAC40 was down 1.33%. The declines on Wall Street are quite substantial. The S&P 500 is losing more than 0.8%, while the Nasdaq is down 1.0%.
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