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Good morning. The US debt-limit deal moves to its next phase, Fed officials signal plan to``skip,'' and AI enthusiasts get a gut check. Here's what people are talking about.

The House passed debt-limit legislation forged by President Joe Biden and Speaker Kevin McCarthy that would impose restraints on government spending through the 2024 election and avert a destabilizing US default. Lawmakers from both parties joined to approve the bill 314-117 Wednesday evening, marking a rare moment of bipartisan accord in a bitterly divided Washington. The deal now heads to the Senate, where approval is virtually certain. The only question is timing as the amount of money the US government has to pay its bills has already plunged to the lowest since 2017.

Federal Reserve officials are signaling they plan to keep interest rates steady in June while retaining the option to hike further in coming months. Skipping an increase would give policymakers time to assess data but not preclude future tightening, Governor Philip Jefferson said Wednesday. The message was echoed by Philadelphia Fed President Patrick Harker, who also urged a June pause. That view undercuts the importance of the monthly jobs report, due Friday, which has often been viewed by Wall Street as a key data point swaying policy.

Investors riding the rapid ascent of the artificial intelligence theme are experiencing a hiccup as shares of Nvidia and other major players slip after a powerful rally. Nvidia fell 5.7% Wednesday, the most since Jan. 30, after the chipmaker briefly reached a $1 trillion market cap earlier this week. The stock's 250%-plus surge from an October low likely provided an attractive opportunity to pocket some gains, with board member Tench Coxe among people who recently took some money off the table. Wall Street has been obsessed with everything AI this year, but lofty valuations — Cathie Wood says it's priced ahead of the curve — are a reason for caution in the still nascent industry.

The US and the European Union are still struggling to agree on specific ways to slow China's technological rise and limit its coercive trade practices even as both have signed onto the strategic need to "de-risk" their relationships with Beijing. Senior US officials had wanted the EU to agree this week to jointly pursue a new mechanism to screen outbound investments to places like China. Instead, the two sides emerged from a high-level trade meeting in northern Sweden with a joint document that largely avoids mentioning Beijing.

European shares are headed for gains as traders weigh progress on the US debt deal and comments from Fed officials. The ECB will issue a report on its May policy meeting, while ECB President Christine Lagarde and German Finance Minister Christian Lindner are due to speak at a conference. Expected data include manufacturing PMIs from around the region, as well as Dutch and Austrian inflation data. Remy Cointreau and Auto Trader Group are scheduled to report earnings.

This is what's caught our eye over the past 24 hours.

Italy starts €1 billion sovereign fund for key supply chains.
Airlines are weighing passengers for safety reasons after Covid.
Elon Musk world's richest person again as Arnault's LVMH sinks.
Britain's electric cars cut deeper into £32 billion fuel duty.
HSBC explores deals in ESG debt market that Credit Suisse built.
Morgan Stanley sets $12 billion profit goal for wealth unit.
LME plans changes that would make contracts more algo-friendly.

It's been a tough year for industrial commodities, with the global manufacturing sector looking much weaker than services. Energy has fared worse than metals, but this is likely to change if OPEC+ delivers on Saudi threats to cut production while China demand slows.

Official numbers from China Wednesday showed manufacturing PMI fell to 48.8, even weaker than the median estimate of 49.5. Now, some might wonder if the PBOC will be tempted to stimulate the economy, but with the services sector still expanding -- and China's growth targeted at consumers -- this seems unlikely.

In the meantime, OPEC and partners meet soon, and even though there has been some disagreement inside the alliance, the powerful Saudi faction seems to be willing to support prices. And while China is a big consumer of both metals and energy, demand for the former is more concentrated on the country, meaning industrial weakness should have a bigger impact on the likes of copper.

Eddie van der Walt is Deputy Managing Editor of the Markets Live blog on the Bloomberg Terminal, based in London. Follow him on Twitter at @EdVanDerWalt.