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Daily Market Insight: 25 May 2023

25 May 2023
  •   USDTHB: moving in the range 34.66-34.735 this morning supportive level at 34.60 resistance level at 34.85

·         SET Index: 1,536.5 (+0.11%), 24 May 2023

·         S&P 500 Index: 4,115.2 (-0.73%), 24 May 2023

·         Thai 10-year government bond yield (interpolated): 2.57 (+0.86 bps), 24 May 2023

·         US 10-year treasury yield: 3.73 (+3.00 bps), 24 May 2023


  • Yellen maintains early June as U.S. debt ceiling deadline
  • UK inflation falls by less than expected, heaping pressure on BoE
  • Singapore's Q1 GDP contraction raises recession risk; China revival key
  • Dollar gains on resilient U.S. economy, flight to safety


Yellen maintains early June as U.S. debt ceiling deadline U.S. Treasury Secretary Janet Yellen on Wednesday maintained early June as a debt ceiling default deadline and said she will update Congress shortly about government finances. Speaking at a Wall Street Journal forum, Yellen said it was hard to be precise about exactly which day the U.S. government will run short of funds but added that she will try to increase the level of precision on a date, based on incoming government receipts. Yellen reiterated on Monday she expects to be able to pay the U.S. government's bills only until June 1 without a debt limit increase, leaving just over a week for White House negotiators and congressional Republicans to reach a compromise and see the deal approved by Congress.


UK inflation falls by less than expected, heaping pressure on BoE Britain’s stubbornly high inflation rate fell by less than expected last month and a closely watched measure of core price rises surged to a 31-year high, according to official data that raised the chances of more interest rate hikes. Consumer prices rose by 8.7% in annual terms in April, down from 10.1% in March but still leaving Britain with the joint highest rate of inflation among Group of Seven advanced economies alongside Italy. In Western Europe, only Austria had a higher rate. Economists polled by Reuters had forecast that the headline CPI annual rate would drop to 8.2% in April, moving further away from October’s 41-year high of 11.1%. Earlier this month, the Bank of England (BoE) forecast inflation of 8.4% for April.


Singapore's Q1 GDP contraction raises recession risk; China revival key Singapore's economy contracted in the first quarter, raising the risk of a recession in the city state as the global economic outlook weakens, and major trading partner China struggles for a post-COVID lift-off. Singapore, a major financial hub, is reliant on trade flow to keep its economy humming, though external demand has faltered in the wake of rising borrowing costs and still-strong inflationary pressures. Gross domestic product rose 0.4% on a year-on-year basis in the first quarter of 2023, official data showed on Thursday, beating the advanced estimate of 0.1% released last month. Yet, on a quarter-on-quarter, seasonally-adjusted basis, the economy shrank 0.4%, a reversal from the 0.1% growth in the fourth quarter of 2022.


Dollar gains on resilient U.S. economy, flight to safety The 10-year government bond yield (interpolated) on the previous trading day was 2.57, +0.86 bps. The benchmark government bond yield (LB31DA) was 2.57, +1.00 bps. LB31DA could be between 2.20-2.70. Meantime, the latest closed US 10-year bond yields was 3.73, +3.00 bps. USDTHB on the previous trading day closed around 34.55 Moving in a range of 34.66-34.735 this morning. USDTHB could be closed between 34.30-34.80 today. The dollar hit a fresh two-month high against a basket of peers on Wednesday, bolstered by recent signs of a resilient U.S. economy, while unease over U.S. debt ceiling talks kept investors moving to safe havens. The dollar is not seen posing an immediate risk, unlike certain Treasury securities, even though the debt ceiling impasse in Washington could lead to a default and push the U.S. economy into recession. Market bets that the Fed will raise rates at its next meeting in June rose slightly after minutes from its policy-setting meeting in early May were released. Fed officials "generally agreed" last month that the need for further rate increases "had become less certain," but others cautioned the U.S. central bank needed to keep its options open given the risks of persistent inflation.


Sources : ttb analytics , Bloomberg, CNBC, Trading economics, Investing, CEIC