- USDTHB: moving in the range 33.935-34.00 this morning supportive level at 33.80 resistance level at 34.10
- SET Index: 1,439.9 (-0.22%), 12 Dec 2024
- S&P 500 Index: 6,051.3 (-0.54%), 12 Dec 2024
- Thai 10-year government bond yield (interpolated): 2.322 (+0.24 bps), 12 Dec 2024
- US 10-year treasury yield: 4.32 (+6.00 bps), 12 Dec 2024
- U.S. Producer Price Index beats forecasts
- US jobless claims rose to highest in two months
- ECB cuts rates by 25 bps, signals potential for more
- China vows bigger fiscal spending to boost consumption next year
- Dollar up on inflation data, euro down after ECB cut
U.S. Producer Price Index beats forecasts
US wholesale inflation unexpectedly rose in November, mainly due to a 55% surge in egg prices driven by bird flu. The producer price index (PPI) rose 0.4% from October, the largest increase since June, surpassing the 0.2% forecast. On annual basis, the PPI rose 3%, marking the biggest gain since early 2023. Meanwhile, core PPI rose 0.2% monthly and 3.4% annually. The BLS noted that 80% of the increase was food-related, while services costs and goods prices (excluding food and energy) rose modestly.
US jobless claims rose to highest in two months
US unemployment benefit applications reached a two-month high last week, during a typically volatile period around the holidays. Initial claims rose by 17,000 to 242,000 for the week ending December 7, above the expected 220,000. Continuing claims also climbed to 1.89 million in the prior week, which included the Thanksgiving holiday. Only four states saw slight declines, indicating that the increase in new claims was widespread.
ECB cuts rates by 25 bps, signals potential for more
The European Central Bank reduced interest rates at its Thursday meeting, as expected, and suggested that further rate cuts could occur in 2025 due to the struggling eurozone economy and inflation nearing its target. The ECB lowered its benchmark deposit rate by 25 basis points to 3.0%, and the rate on its main refinancing operations decreased to 3.15%. This brings the total reduction since June to 100 basis points. The ECB's statement removed the phrase about maintaining "sufficiently restrictive" policy, reflecting a shift in approach. In addition, its new quarterly projections also downgraded growth and inflation expectations for next year due to the weak economic outlook.
China vows bigger fiscal spending to boost consumption next year
China has indicated plans for increased public borrowing and spending in 2025, focusing on boosting consumption and providing stimulus to support growth ahead of US tariffs. Following the Central Economic Work Conference, officials, including President Xi Jinping, revealed intentions to raise the fiscal deficit target, and lower interest rates and bank reserve requirements at the right time. The priority for 2025 will be boosting consumption and stimulating domestic demand. The government also aims to sustain economic growth and price stability, while expanding the issuance of treasury bonds and local government notes for infrastructure. The exact timing of these measures is uncertain, but an RRR cut is expected by year-end, with further rate cuts likely in early 2025.
Dollar up on inflation data, euro down after ECB cut
The 10-year government bond yield (interpolated) on the previous trading day was 2.322, +0.24 bps. The benchmark government bond yield (LB346A) was 2.30, +1.0 bps. Meantime, the latest closed US 10-year bond yields was 4.32, +6.00 bps. USDTHB on the previous trading day closed around 33.85, moving in a range of 33.935 – 34.00 this morning. USDTHB could be closed between 33.80 – 34.10 today. The dollar's rally continued for a fifth day, fueled by a surprise 50bps cut from the SNB and a shift in the ECB's statement after its 25bps cut. The euro fell below 1.05, while the Japanese yen weakened on reports that the BoJ may keep rates steady next week, though no consensus has been reached.
Sources : ttb analytics , Bloomberg, CNBC, Trading economics, Investing, CEIC
