The White House on Wednesday stepped up efforts to get Congress to raise the federal debt ceiling. National Economic Council Deputy Director Bharat Ramamurti and Treasury counselor Ben Harris conveyed the message to Democrats that it’s the shared responsibility of Republicans to avoid a U.S. payment default. The messaging push comes after 46 out of the 50 Senate Republicans wrote on Aug. 10 that they would not vote to increase the debt ceiling -- a sufficient number to block a bill doing so under normal Senate procedures. Senate Minority Leader Mitch McConnell said that with Democrats pursuing a $3.5 trillion social-spending package this autumn, they cannot expect GOP cooperation on the debt. There was no message on whether or not any budget reforms could be attached to a bill raising the debt ceiling nor any on the exact timing needed to avoid a default, according to the White House official.
South Korea August inflation stays at 9-year peak, beats forecast
South Korea's August consumer inflation stayed at a nine-year peak fuelled by a continued spike in prices of fresh food due to a heat
wave and the rising cost of oil products, housing rental and other services. The consumer price index (CPI) last month rose 2.6%
from a year earlier, Statistics Korea said, unchanged from July. The 2.6% rise was first seen in May, when inflation marked the
fastest pace since April 2012, and continued to stay above the central bank's 2% target for a fifth straight month. Thursday's data
comes a week after the Bank of Korea raised its policy rate for the first time in almost three years, becoming the first major Asian
central bank to shift away from pandemic-era monetary settings as ballooning consumer debt created new threats for the economy.
China likely to quicken fiscal spending, but policy rate cuts not on the cards
China is likely to accelerate fiscal spending and credit growth as its economic recovery slows, but investors are expecting any easing
measures from Beijing to be finely targeted as the U.S. Federal Reserve prepares to taper its own stimulus. Market participants are
increasing their bets that the People's Bank of China (PBOC) will once again reduce banks' reserve requirement ratio (RRR) to make
up for liquidity shortfalls towards the year-end. At the same time, market yields are low enough that few expect a policy rate cut
which would widen the Sino-U.S. monetary stance gap, risking a surge in capital outflows.
Dollar Up, but “Big Miss” in U.S. Employment Data Caps Gains
The 10-year government bond yield (interpolated) on the previous trading day was 1.60, +1.50 bps. The benchmark government
bond yield (LB31DA, 10.5 years) was 1.62, +2.00 bps. LB31DA could be between 1.58 -1.64. Meantime, the latest closed US 10-
year bond yields was 1.31%, +1.00bps. USDTHB on the previous trading day closed around 32.35 Moving in a range from 32.32-
32.47 this morning. USDTHB could be closed between 32.42-32.55 today. Meantime, The dollar was up on Thursday morning in
Asia but remained near multi-week lows. However, disappointing U.S. employment data ahead of the latest U.S. jobs report, which is
expected to guide the timing of the U.S. Federal Reserve's asset tapering timeline, capped gains for the U.S. currency.
Sources : Bloomberg, CNBC, Investing, CEIC
