- USDTHB: moving in the range 34.52-34.55 this morning supportive level at 34.40 resistance level at 34.60
- SET Index: 1,384.8 (+0.36%), 3 Jan 2025
- S&P 500 Index: 5,942.5 (+1.25%), 3 Jan 2025
- Thai 10-year government bond yield (interpolated): 2.306 (-0.40 bps), 3 Jan 2025
- US 10-year treasury yield: 4.60 (+3.0 bps), 3 Jan 2025
- US manufacturing index rose slightly at year-end
- Barkin says he prefers Fed keep rates restrictive for longer
- German unemployment rose less than expected in December
- Japan's service sector experiences growth driven by robust demand
- Dollar dips but eyes strong weekly gains
US manufacturing index rose slightly at year-end
The ISM manufacturing index rose nearly one point to 49.3, marking the highest level since March. Although it remains below 50, indicating continued contraction, the reading exceeded expectations. New orders surged by over 2 points to 52.5, the strongest result since early last year and the highest since May 2022. This boost in demand led to the first month of production growth since May. However, the employment index dropped nearly 3 points, the largest decline since July, to 45.3 in December. Meanwhile, the other four components of the overall PMI all saw improvements. Seven industries contracted, led by textiles, fabricated metals, and printing, while seven sectors expanded, including primary metals and electrical equipment.
Barkin says he prefers Fed keep rates restrictive for longer
Fed's Barkin expressed a positive outlook for 2025, with more upside than downside risks to growth, as strong employment and asset values support consumer spending. He expects the labor market to lean towards more hiring than layoffs. While inflation remains above target, he sees core inflation decreasing and anticipates a decline in 12-month inflation, partly due to base effects. He favors keeping policy restrictive longer due to potential inflation risks and emphasized that rate cuts depend on inflation reaching 2% or weakening demand.
German unemployment rose less than expected in December
German unemployment rose by 10,000 in December, a smaller increase than the 15,000 anticipated, indicating that the labor market is managing the current economic downturn well. The unemployment rate remained steady at 6.1%. Despite the economy contracting in 2023 and 2024, the job market has been one of its few resilient sectors and is projected to grow by only 0.2% this year.
Japan's service sector experiences growth driven by robust demand
Japan's service sector expanded for the second month in December, with the final service PMI rising to 50.9 from 50.5 in November. Despite being lower than the flash estimate of 51.4, it stayed above 50.0. New business grew for the sixth month, driven by domestic customer acquisitions. Employment increased for the 15th month, though at a slower pace. The composite PMI, combining manufacturing and services, rose to 50.5 from 50.1 in November.
Dollar dips but eyes strong weekly gains
The 10-year government bond yield (interpolated) on the previous trading day was 2.306, -0.40 bps. The benchmark government bond yield (LB346A) was 2.28, +0.0 bps. Meantime, the latest closed US 10-year bond yields was 4.60, +3.0 bps. USDTHB on the previous trading day closed around 34.44, moving in a range of 34.52 – 34.55 this morning. USDTHB could be closed between 34.40 – 34.60 today. The dollar pared back its weekly gains by the weekend, with the index dipping just around the 108 mark. Losses were observed both before and after the ISM PMIs, where manufacturing saw an unexpected rise in December. Most G10 currencies regained the losses from Thursday, with the GBP and EUR, which had been lagging, emerging as the top performers. The euro ended the week slightly above 1.03, while the Japanese yen managed to reverse its Thursday losses.
Sources : ttb analytics , Bloomberg, CNBC, Trading economics, Investing, CEIC
