Debt deal delays to bring higher interest rates

<p>Kia ora,</p><p>Welcome to Monday’s Economy Watch where we follow the economic events and trends that affect Aotearoa/New Zealand.</p><p>I'm David Chaston and this is the international edition from Interest.co.nz.</p><p>And today we lead with news the Americans seem to have a deal on their Debt limit - at least until the extreme party members are overcome in a vote. They have enough funding authorised to <a href="https://home.treasury.gov/system/files/136/Debt-Limit-Letter-to-Congress-Members-20230526-McCarthy.pdf" target="_blank"><strong>last until June 5</strong></a>.</p><p>In the week ahead, we will get the US non-farm payrolls report on Saturday, and before that the JOLTS job openings numbers, the ISM Manufacturing PMI, and the Conference Board consumer confidence survey results. We will also get inflation rates for April for the EU, Germany, France, Italy, Spain, and South Korea. In addition, Q2 GDP growth rates will be released for Canada, India, Brazil, and Turkey, along with factory PMIs for China, Italy, Spain, Canada, Russia, India, and South Korea.</p><p>Over this past weekend China's industrial profits <a href="http://www.stats.gov.cn/sj/zxfb/202305/t20230526_1940198.html" target="_blank"><strong>data</strong></a> was released for April and it was weak. It fell almost -21% in the January-April period from the same time frame in 2022 although the drop was slower than a decline of slightly more than -21% for the first quarter. The marginal improvement in April alone will be of little real comfort because this is when a 'recovery surge' was hoped for on their opening up. But it isn't happening. Private firms are doing much worse than State-owned enterprises.</p><p>And Taiwan lowered its economic growth <a href="https://eng.stat.gov.tw/Point.aspx?sid=t.1&n=4200&sms=11713" target="_blank"><strong>forecast</strong></a> for the year to +2.0%, the slowest pace in nearly eight years, after the island slipped into a recession in Q1-2023 <a href="https://eng.stat.gov.tw/News_Content.aspx?n=2317&s=231439" targe