US House Passes Bill to Raise Debt Ceiling As Deadline Looms
The US House of Representatives passed a bill to raise the debt ceiling, bringing the country closer to averting a default. The bill will now be sent to the Senate for approval before President Joe Biden can sign it into law before the June 5 deadline. The move is considered a big victory for Republican House Speaker Kevin McCarthy, who managed to convince Democrats to side with Republicans and prevent a rebellion from some of the hardline House Freedom Caucus members. However, 71 Republicans voted against the bill. Here are the two articles recommended analyzing the impact of the bipartisan agreement on Kevin McCarthy and Joe Biden, respectively.
Other major global events to watch out for include NATO foreign ministers meeting in Oslo to discuss the Ukraine war, and the European Central Bank releasing minutes from last month’s policy meeting. S&P Global will also release manufacturing purchasing managers indices for the EU, UK, and US, and inflation data in the Eurozone will be published. In the corporate world, Auto Trader, Broadcom, Dell Technologies, Dollar General, Dr Martens, Macy’s, Pennon, and Rémy Cointreau will share their results.
EU Drafting Multi-Billion Dollar Financing Plan for Ukraine
The European Union (EU) is reportedly drafting a multi-billion dollar financing plan spanning four years for Ukraine. The fund aims to provide more stable financial support than the bloc’s previous haphazard and unpredictable assistance, given that public finances in Kiev have been significantly impacted by the Russian conflict.
Canadian Pension Fund Stops Making Private Deals in China
Canada’s $400 billion pension fund has stopped making private deals and closing its Shanghai office, following other big investors in decreasing their activity in China, the world’s second-largest economy. Caisse de dépôt et placement du Québec joined the initiative amid concerns over China’s faltering economy and deeper structural challenges, according to the Financial Times editorial staff.
UK Business Group Urges Government to Align with EU Standards Post-Brexit
A cross-party business group has recommended that the United Kingdom adopt a “general policy” of alignment with the European Union’s standards to enhance post-Brexit trade. The UK Trade and Business Commission submitted the recommendation among 114 proposals in a report released yesterday.
Study Finds Earth Has Already Passed Safe Limits for Humans
A new study by the world’s top scientists warns that humans have already exceeded the safe limits for temperature rise, water system disruption, and natural habitat destruction. The study urges governments and private institutions to act urgently to address climate change and mitigate its impact.
The Big Read: How Small Can Chips Really Get?
The Financial Times examines experts’ warning that continued semiconductor miniaturization faces fundamental physical limits in its latest big read. One key question the article raises is how small chips can get, especially as the demand for smaller devices continues to increase.
Chart of the Day: US Junk Bond Market Shows Resistance Despite Economic Challenges
The $1.4 trillion US junk bond market continues to show resilience, despite concerns about rising interest rates and economic challenges. The chart of the day attributes the strength to the scarcity of supply.
Additional Piece: Understanding US Debt Ceiling and Its Implications on the Economy
The US debt ceiling is a legal limit on the amount of national debt that the US government can accumulate through borrowing. The government can only continue to borrow if the debt ceiling is raised, and the current limit is set at $28.5 trillion. Failure to raise the debt ceiling could result in the US defaulting on its debt obligations. The implications of such a default could be severe, including economic crises, trade issues, and damage to the country’s reputation. However, the debt ceiling has been raised several times over the years without issue. Understanding the implications of the debt ceiling is necessary for investors, policymakers, and the public to make informed decisions.
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This article is an on-site version of ours FirstFT news bulletin. Subscribe to our Asia, Europe/Africa OR Americas edition to receive it directly in your inbox every weekday morning
The US House of Representatives brought the country one step closer to averting a default last night passed a crucial bill to raise the debt ceiling.
In a big victory for Republican House Speaker Kevin McCarthy, the House voted 314-117 in favor of the bill, after 165 Democrats sided with 149 Republicans and allowed it to fend off a rebellion by some members of his same party.
Ultimately, 71 Republicans voted against the measure, many of them members of the hardline House Freedom Caucus.
The bill will now be sent to the Senate, which will also need to approve the measure so that it can be signed into law by President Joe Biden and go into effect before the June 5 deadline.
Here are two analyzes I recommend about what the bipartisan agreement means to the two men who made it:
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Kevin McCarthy: When he won the speaker’s position in January, there were doubts as to whether he could control his party. McCarthy yesterday he defied his criticswrites Giacomo Politi.
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Joe Biden: The drama has it just made a dent in the president’s agendawrites Edward Luce, with Republicans exiting fiscal risk with little to show for it.
Here’s what else I’m keeping an eye out for today:
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Dating about Ukraine: NATO foreign ministers meet in Oslo to discuss war, while nearly 50 leaders are in Moldova, just 8km from a Russian-controlled separatist enclavefor the summit of the European Political Community.
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European Central Bank: President Christine Lagarde speaks at a conference in Hanover and the bank releases minutes from last month’s policy meeting. The ECB also marks its 25th year since it replaced the European Monetary Institute.
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Economic data: S&P Global Releases Manufacturing Purchasing Managers Indices for EU, UK and US and inflation in the eurozone should cool down when the data is released today.
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Results: Report by Auto Trader, Broadcom, Dell Technologies, Dollar General, Dr Martens, Macy’s, Pennon and Rémy Cointreau.
Five more top stories
1. Exclusive: The EU is working on a four-year multi-billion dollar financing plan for Ukraine after allies last year criticized the bloc’s haphazard and unpredictable financial support to Kiev, where public finances are under enormous strain due to the war in Russia. Read the full story.
2. Exclusive: Canada’s $400 billion pension fund has stopped making private deals in China and is closing its Shanghai office, following other big investors in reducing activity in the world’s second-largest economy. Read more about the move by Caisse de dépôt et placement du Québec.
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The FT view: China’s recovery is faltering, but the structural challenges facing its economy they are much deeper and more long-termwrites the editorial staff of the Financial Times.
3. OPEC barred several major media groups from attending its crucial production meeting, with reporters from Reuters, Bloomberg News and The Wall Street Journal denied invitations to the event at the oil group’s headquarters in Vienna. The move is unusual for OPEC, with headlines from his meetings that have the potential to move oil prices.
4. A future UK government should adopt a “general policy” of alignment with EU standards to improve post-Brexit trade, said an independent cross-party business group. The recommendation was one of 114 proposals submitted in a report from the UK Trade and Business Commission yesterday.
5. The earth has already passed the safe limits for humans how the temperature rise, the disruption of the water system and the destruction of natural habitats have reached their limits, a study conducted by a group of the world’s top scientists has found. Here are more details from the research published yesterday in Nature.
The big read
© Edit FT/Reuters/ASML/Ian Bott
Over the past fifty years, the pace of progress in the technology sector and in products like the iPhone has only been made possible because semiconductors have been able to get smaller and smaller. But experts warn that this continued feat will soon hit the fundamental limits of physics, raising a big question: how small can chips be?
We are also reading. . .
Chart of the day
Despite concerns about rising interest rates and the health of the world’s largest economy, the The $1.4 trillion US junk bond market looks surprisingly resilient. At the heart of its relative strength is scarcity of supply.
Take a break from the news
Meet the woman who dresses Gen Z. Sofia Prantera created streetwear label Aries to move into denim with a more high-fashion offering. explains fashion writer Kate Finnigan how Aries has gained a cult following with youngsters.
Additional contributions from Emily Goldberg and Ben Wilhelm
https://www.ft.com/content/1e40910b-7339-4d7f-8be5-aa951fa0ca18
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