Investors, though, clearly want to see ink on paper. Equity markets weakened around most of Asia on Monday – with the notable exception of Japan – after the U.S. budget office backed the idea that Treasury funds will run out at the start of next month.
Currency markets though were paying more attention to stunning regional election results in Thailand and Turkey.
Turkish president Tayyip Erdogan defied pollsters and kept alive his hope of extending a two-decade rule by forcing a runoff after leading Sunday’s vote. The lira dipped to the lowest since March, when it was reeling in the aftermath of devastating earthquakes.
Meanwhile, the baht soared after Thai opposition parties crushed military-backed parties on the weekend, signalling wide and strong discontent with the ruling junta.
However, the liberal Move Forward party and the populist Pheu Thai Party will not only need to broker a deal with each other, but also somehow win the backing of the junta-appointed senate to form a government.
The yuan touched a fresh two-month low amid worrying signs in data last week that the best part of China’s COVID recovery is already behind. Retail sales on Tuesday will be the next test of flaccid consumer demand, following shocking results from import and inflation numbers.
The People’s Bank of China is holding fire for now, opting to leave rates unchanged on Monday.
China may have its economic troubles, but it’s still flexing its geopolitical muscle, sending its top envoy on a tour of Ukraine, Russia and elsewhere in Europe from today to discuss a “political settlement” to the Ukraine crisis.
/cloudfront-us-east-2.images.arcpublishing.com/reuters/FXOSR5UORJO7VLALT3RU62ULJA.jpg "Debt impasse dominates in big day for politics 40")
