Asia markets rise after U.S. reaches debt ceiling deal, Japan stocks at highest since July 1990

The latest slump in China’s industrial profits provides an argument for its central bank to lower interest rates, Deloitte China told CNBC.

“There is no inflation in China, so you need looser monetary policy,” Deloitte China chief economist Sitao Xu told CNBC’s “Squawk Box Asia” on Monday.

He pointed to the People’s Bank of China’s daily USD/CNY reference rate, or the midpoint fix, as functioning similarly to a rate cut.

“If you look at the recent change in the exchange rate, the effect is the same as lowering the interest rate,” he told CNBC.

The PBOC on Monday set its yuan fixing at 7.0575 compared to 7.0760 in the previous session against the US dollar.

— Jihye Lee

Singapore state-owned investor Temasek has cut the compensation of senior management and its investment team responsible for the recommendation to invest in failed cryptocurrency exchange FTX.

“While there was no misconduct by the investment team in reaching their investment recommendation, the investment team and senior management, who are ultimately responsible for the investment decisions made, take joint responsibility and reduced their compensation,” Chairman Lim Boon Heng said in a statement.

The move from Temasek comes after an internal review was launched to look into its investment in FTX, which resulted in a write-down of $275 million.

Lim added that there was fraudulent behavior by FTX that was “deliberately hidden from investors, including Temasek.” The statement did not specify how many staff were affected, or the severity of the pay cuts.

— Lim Hui Jie

Cleveland Federal Reserve President Loretta Mester told CNBC on Friday that she expects more interest rate hikes will be needed as inflation remains high.

“When I look at the data and I look at what’s going on with the inflation numbers, I think we need to tighten more,” Mester said on “Squawk on the Street.” “We’ve made progress. Now it’s a calibration exercise, and that’s the hard part.”

Mester was a nonvoting member this year on the rate-setting Federal Open Market Committee.

—Jeff Cox

The core personal consumption expenditures index, the Fed’s preferred measure of inflation, rose 0.4% in April. That’s more than economists polled by Dow Jones expected. Year over year, core PCE rose 4.7%, more than expected.

— Fred Imbert

Markets raised their bets for a June rate hike from the Federal Reserve following warmer-than-expected inflation data Friday morning.

The odds for a quarter percentage point increase jumped to 56%, according to CME Group data. This follows a report showing that personal consumption expenditure prices rose 0.4% in April and 4.7% from a year ago.

The chances of an increase were only 17% a week ago. The probability of an increase no later than July has increased to 75%.

—Jeff Cox

The final May consumer sentiment reading was slightly above expectations. The University of Michigan consumer sentiment index came in at 59.2, while economists polled by Dow Jones predicted a reading of 57.7.

To be sure, that level is below April’s 63.5.

“Consumer sentiment fell 7% amid concerns about the path of the economy, erasing nearly half of the gains after an all-time historic low since last June. This decline reflected the 2011 debt ceiling crisis, where sentiment also fell,” Surveys of Consumers director Joanne Hsu wrote.

— Fred Imbert