<div id="readability-page-1"><ul><li>China foreign ministry says we should reopen Hormuz ASAP</li><li>South Korean stocks reverse record highs as Trump patience on Iran wears thin</li><li>Trump touts China trade wins on Fox as oil rises and markets turn cautious (equities down)</li><li>PBOC sets USD/ CNY reference rate for today at 6.8415 (vs. estimate at 6.7976)</li><li>Japan finance minister heads to G7 as energy costs and bond yields dominate</li><li>Japan wholesale prices surge 4.9% as Iran war drives import cost spike</li><li>USTR Greer flags China ag deal progress but holds firm on tariff uncertainty</li><li>More from Fed's Barr - hasn't decided on what to do at June FOMC meeting</li><li>Japan April wholesale prices surge, PPI +4.9% y/y (expected +3%, prior +2.6%)</li><li>Ex-Google CEO Schmidt says cash, not energy, is the real limit on AI growth</li><li>Fed's Barr warns shrinking balance sheet via liquidity cuts risks stability</li><li>More from Fed's Williams, sees no case for rate move as policy sits in good place</li><li>New Zealand manufacturing expansion slows sharply in April, PMI data shows</li><li>Fed Williams sitting on the fence on inflation, but says persistent above target</li><li>Trump says &#34;President Xi congratulated me&#34;!</li><li>Trump win. US House ties on Iran war vote. War costs, gas prices test Republican unity.</li><li>Morgan Stanley sees AI and consumers driving growth as energy shock clouds outlook</li><li>Warsh Fed appointment unlikely to deliver rate cuts, analysts warn</li><li>Trump ethics filing reveals $220m in trades across major US stocks</li><li>investingLive Americas FX news wrap 14 May:AI boom powers markets higher. USD higher.</li></ul>Government bond yields ground higher across the session, with the 10-year US Treasury pushing above 4.5%, lending support to the dollar while weighing on equities and metals. It was a broadly risk-off tone that built gradually through the day rather than arriving in one sharp move.The Federal Reserve provided the early narrative. New York Fed President John Williams said monetary policy is in a good place and that he sees no reason to raise or lower rates right now, a stance he grounded in his view that tariff-driven inflation has largely passed through and that the labour market is not generating unusual second-round price pressures. Fed Governor Barr added a separate note of caution, pushing back firmly against proposals to loosen bank liquidity rules as a means of shrinking the Fed's balance sheet, warning the approach would increase financial stability risks rather than reduce the central bank's footprint.From Asia, Japan's wholesale price data delivered a jolt. The corporate goods price index rose 4.9% year-on-year in April, nearly double the forecast, as Iran war-driven energy costs pushed import prices up 17.5% and naphtha surged 83.2% month-on-month. The print is expected to intensify debate at the BOJ ahead of its June meeting, with rate hike expectations likely to be brought forward. Finance Minister Katayama, meanwhile, pledged a flexible fiscal response to rising energy costs but stopped short of committing to a subsidy revival, noting Japan holds 1 trillion yen in budget reserves as a near-term buffer. She heads to France this weekend for the G7 Finance Ministers' meeting, where rising global bond yields are expected to feature prominently on the agenda.Indian state fuel retailers raised diesel and gasoline prices on Friday for the first time in four years, a sign that energy cost pressures are beginning to force the hand of governments that had previously absorbed them.On the AI front, former Google chief executive Eric Schmidt made waves with a blunt assessment of where the real constraint on artificial intelligence development lies. It is not energy, he argued, but capital. At roughly $50 billion per gigawatt of compute capacity, a 10-gigawatt buildout would cost around half a trillion dollars, a sum only a handful of countries and institutions can realistically mobilise. Schmidt identified China as capable of matching the US at that scale, while describing Europe as effectively priced out of the race by the limitations of its capital markets. The comments add a financial lens to a debate that has largely focused on power and compute, and carry pointed implications for how the AI competitive landscape develops over the next decade.On trade, US Trade Representative Jamieson Greer said the US-China summit had delivered meaningful progress, with a deal covering double-digit billions of dollars in American agricultural sales to China expected to emerge from the talks. China is already fulfilling existing soybean purchase commitments, Greer said. He declined to commit to any specific tariff rate on Chinese goods, however, preserving negotiating flexibility while leaving businesses without the certainty they have been seeking. Findings from ongoing trade investigations are expected within weeks, a timeline that could generate fresh headlines early next week. Notably, Greer said chip export controls were not a major topic at the summit, and framed any potential Chinese purchases of Nvidia H200 chips as a sovereign decision for Beijing.Oil drifted higher through the session, with two competing explanations on offer.1. Trump told Fox News that Xi Jinping is keen on buying more US crude, a comment that added a demand-side dimension to the trade optimism of recent days. But the more unsettling driver was geopolitical. 2. Reports emerged that Washington had informed Israel of the possibility that Trump could order strikes inside Iran, with Israeli officials said to be on high alert this weekend. Trump himself said it is only a matter of time on Iran and that his patience is running thin, adding that while he would prefer to remove Iran's enriched uranium stockpile he could accept it being locked under monitoring.South Korean equities captured the mood of the session neatly. The KOSPI briefly touched a record high above 8,046 before reversing to close more than 2% lower as Trump's Iran comments landed. It remained on track for a sixth consecutive weekly gain, but the intraday swing said everything about how quickly sentiment can turn.Trump departs Beijing later today to head home. It is going to be another nervy weekend.</div>

FLKR

The Asia-Pacific FX news highlights a cautious market as South Korean stocks retreat from record highs amid rising tensions in Iran. Japan's wholesale prices surged 4.9% year-on-year, driven by energy costs, prompting discussions on potential rate hikes. The U.S. Trade Representative noted progress in U.S.-China agricultural trade talks, while former Google CEO Eric Schmidt emphasized capital as the main constraint on AI growth. Overall, the market sentiment remains risk-averse with rising bond yields impacting equities.

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investingLive Asia-Pacific FX news wrap: KOSPI 8K record short-lived as Iran nerves bite