- USDTHB: moving in the range 35.445-35.59 this morning supportive level at 35.35 resistance level at 35.60
· SET Index: 1,380.7 (-1.51%), 17 Jan 2024
· S&P 500 Index: 4,739.2 (-0.56%), 17 Jan 2024
· Thai 10-year government bond yield (interpolated): 2.75 (+1.59 bps), 17 Jan 2024
· US 10-year treasury yield: 4.10 (+3.00 bps), 17 Jan 2024
- Strong US retail sales underscore economy's momentum heading into 2024
- ECB President Lagarde hints at potential summer rate cuts
- Japan Nov machinery orders fall more than expected
- Dollar holds near one-month peak as dovish Fed bets recede
Strong US retail sales underscore economy's momentum heading into 2024 US retail sales rose more than expected in December, boosted by an increase in motor vehicle and online purchases, keeping the economy on solid ground heading into the new year. The upbeat report from the Commerce Department, which prompted economists to upgrade their economic growth estimates for the fourth quarter, cast further doubt on financial market expectations that the Federal Reserve would start cutting interest rates in March. Retail sales rose 0.6% last month after an unrevised 0.3% gain in November, the Commerce Department's Census Bureau said. Economists polled by Reuters had forecast retail sales would gain 0.4%. Retail sales are mostly goods and are not adjusted for inflation. Sales increased 5.6% on a year-on-year basis in December. Sales were likely partially boosted by difficulties adjusting the data for seasonal fluctuations following distortions during the COVID-19 pandemic. In the last couple of years, consumers started their holiday shopping early to avoid empty shelves.
ECB President Lagarde hints at potential summer rate cuts Christine Lagarde, President of the European Central Bank (ECB), suggested today that interest rate cuts could be on the horizon by summer, but she also underscored the importance of moving cautiously due to persistent inflation risks. In an interview with Bloomberg, Lagarde addressed the current market expectations, which have shown a more measured outlook on rate cuts, with Euribor futures indicating a less aggressive stance than previously anticipated. Lagarde cautioned against hasty monetary policy decisions that might lead to the necessity of reversing course with rate increases later on. She stressed the importance of the ECB's policy planning not being swayed by market speculation and the challenges of forecasting market sentiments. The markets have adjusted their expectations accordingly, with Euribor futures dropped by up to 6.5 ticks with around 139bps of reductions priced in for 2024.
Japan Nov machinery orders fall more than expected Japan's core machinery orders fell more than expected in November, underscoring uncertainty about domestic and global economic outlook. Core orders, a highly volatile data series regarded as a leading indicator of capital spending in the coming six to nine months, fell 4.9% in November from the previous month, Cabinet Office data showed. That compared with a 0.8% contraction expected by economists in a Reuters poll. On a year-on-year basis, core orders, which excludes volatile numbers from shipping and electric utilities, declined 5.0% versus a forecast for 0.2% growth, the data showed. Capital spending is one of the key drivers for Japan's economy and a major indicator of business confidence.
Dollar holds near one-month peak as dovish Fed bets recede The 10-year government bond yield (interpolated) on the previous trading day was 2.75, +1.59 bps. The benchmark government bond yield (LB31DA) was 2.715, +3.50 bps. Meantime, the latest closed US 10-year bond yields was 4.10, +3.00 bps. USDTHB on the previous trading day closed around 35.55 Moving in a range of 35.445-35.59 this morning. USDTHB could be closed between 35.35-35.60 today. The dollar held close to a one-month peak versus major peers after robust US retail sales data overnight added to building expectations the Federal Reserve will not rush to lower interest rates. Australia's dollar weakened after data showed an unexpected decline in employment. The US dollar index, which measures the currency against a basket of six rivals, traded little changed at 103.36 in the Asian morning, after reaching 103.69 on Wednesday for the first time since Dec. 13. The yen was a notable underperformer, as it tends to move in the opposite direction of US long-term yields, which also touched a one-month high overnight as dovish Fed bets receded.
Sources : ttb analytics , Bloomberg, CNBC, Trading economics, Investing, CEIC
