- USDTHB: moving in the range 35.98-36.07 this morning supportive level at 35.85 resistance level at 36.15
· SET Index: 1,381.1 (-0.45%), 20 Feb 2024
· S&P 500 Index: 4,975.5 (-0.60%), 20 Feb 2024
· Thai 10-year government bond yield (interpolated): 2.56 (-1.12 bps), 20 Feb 2024
· US 10-year treasury yield: 4.27 (-3.00 bps), 20 Feb 2024
- Fed to cut US rates in June, risks skewed towards later move
- Germany likely in recession, Bundesbank says
- Japan's exports perk up but souring factory mood darkens outlook
- Dollar dips, China boosts global growth hopes
Fed to cut US rates in June, risks skewed towards later move The US Federal Reserve will cut the federal funds rate in June, according to a slim majority of economists polled by Reuters, who also said the greater risk was the first rate cut would come later than forecast rather than earlier. Reuters surveys since September have consistently predicted the first rate cut would come around the middle of this year. Markets, however, have gone from March to May, and now are priced for June as the most likely time for the first rate reduction. Although stock markets have surged to record highs, the US 10-year Treasury yield has jumped nearly 50 basis points to 4.28% this month alone, thanks to a series of releases showing strong growth, a tight labor market, and still-sticky inflation. A strong majority of 86 of 104 economists in a Feb. 14-20 Reuters poll said the Fed would first cut the fed funds rate - currently 5.25%-5.50% - next quarter, similar to last month's survey.
Germany likely in recession, Bundesbank says Germany is likely in recession now as external demand is weak, consumers remain cautious and domestic investment is held back by high borrowing costs, the Bundesbank said in a regular monthly report on Monday about Europe's biggest economy. Germany has struggled since Russia's 2022 invasion of Ukraine pushed up energy costs, and its vast, industry-heavy economy is now in its fourth straight quarter of zero or negative growth, weighing on all of the euro zone. This weak performance has raised questions about the sustainability of the German economic model and critics argue that much of its energy-reliant heavy industry is now being priced out of international markets, warranting an economic transformation. The government, however, has pushed back on gloomy projections, arguing that it is merely a perfect storm of high energy costs, weak Chinese demand and rapid inflation.
Japan's exports perk up but souring factory mood darkens outlook Japan's exports rose more than expected in January, driven by US-bound shipments of autos and car parts and Chinese demand for chip-making equipment, although the worsening factory sector mood added to concerns about broader economic weakness. Ministry of Finance data out showed Japan's exports rose 11.9% in January from the same month a year ago, faster than a 9.5% gain expected by economists in a Reuters poll and 9.7% growth in the previous month. While the brisk exports could ease some concerns about further economic declines, the Reuters Tankan survey showed manufacturers' business morale soured sharply in February, with pessimists outnumbering optimists for the first time in 10 months. Some analysts cautioned against reading too much into the firm export data, noting the 29.2% year-on-year increase in China-bound shipments was partly skewed by comparisons with 2023.
Dollar dips, China boosts global growth hopes The 10-year government bond yield (interpolated) on the previous trading day was 2.56, -1.12 bps. The benchmark government bond yield (LB31DA) was 2.57, -2.00 bps. Meantime, the latest closed US 10-year bond yields was 4.27, -3.00 bps. USDTHB on the previous trading day closed around 36.16 Moving in a range of 35.98-36.07 this morning. USDTHB could be closed between 35.85-36.15 today. The US dollar weakened after China cut interest rates in a bid to prop up its struggling property market, raising hopes of additional stimulus that would boost global growth. The yen gained, meanwhile, but stayed below the 150.88 per dollar level reached, its weakest in 11 weeks, as investors focus on whether renewed weakness in the Japanese currency is likely to prompt intervention by the Bank of Japan and Ministry of Finance. China cut the five-year loan prime rate (LPR) by 25 basis points, which was the largest since the reference rate was introduced in 2019 and far more than analysts had expected.
Sources : ttb analytics , Bloomberg, CNBC, Trading economics, Investing, CEIC
