- USDTHB: moving in the range 34.25-34.29 this morning supportive level at 34.20 resistance level at 34.40
- SET Index: 1,364.6 (+0.81%), 3 Sep 2024
- S&P 500 Index: 5,528.9 (-2.12%), 3 Sep 2024
- Thai 10-year government bond yield (interpolated): 2.575 (+0.12 bps), 3 Sep 2024
- US 10-year treasury yield: 3.84 (-7.0 bps), 3 Sep 2024
- US manufacturing activity declines for the fifth consecutive month
- Japan's service activity grows further in August
- Ueda reaffirms BOJ will raise rates if projections are met
- US dollar little changed after hitting a two-week high
US manufacturing activity declines for the fifth consecutive month
US manufacturing activity contracted for the fifth consecutive month in August, with declines in orders and production accelerating. The ISM Manufacturing PMI rose to 47.2 from 46.8 but was below the anticipated 47.5. A PMI reading under 50 signals contraction. Production fell further into contraction territory, reaching its lowest point since May 2020. New orders dropped to their lowest level in 15 months, and export orders decreased at the fastest rate of the year. However, the employment sub-index improved to 46.0 from 43.4, likely due to fewer temporary layoffs following the auto sector's summer updates.
Japan's service activity grows further in August
Japan's service sector continued to grow in August, buoyed by an increase in overseas sales despite a worsening global outlook. The final au Jibun Bank Service PMI remained steady at 53.7, staying above the 50.0 mark that distinguishes expansion from contraction for the second month in a row. Although the overall index matched July's level, growth in new business for service companies slowed compared to the previous month. However, export sales bounced back from a decline in July, marking their largest increase in three months and supporting the service sector. This contrasts with Japan's manufacturing PMI for August, which showed the weakest export performance in five months due to reduced demand from China, South Korea, and other major markets.
Ueda reaffirms BOJ will raise rates if projections are met
On Tuesday, Bank of Japan Governor Kazuo Ueda reaffirmed that the central bank will continue to raise interest rates if economic conditions and inflation align with the BOJ's expectations. Ueda made this statement in a document presented to a government panel led by outgoing Prime Minister Fumio Kishida, where he outlined the BOJ's policy decision from July. Ueda noted that even after the July rate increase, the economic environment remains accommodative, with real interest rates still significantly negative. He emphasized that the current rates are effectively supporting economic activity. His remarks served as a reminder to market participants that, despite the global market turmoil partly triggered by the BOJ's July rate hike, Ueda remains committed to increasing borrowing costs if the bank's projections prove accurate.
US dollar little changed after hitting a two-week high
The 10-year government bond yield (interpolated) on the previous trading day was 2.575, +0.12 bps. The benchmark government bond yield (LB346A) was 2.57, -1.0 bps. Meantime, the latest closed US 10-year bond yields was 3.84, -7.0 bps. USDTHB on the previous trading day closed around 35.24 moving in a range of 34.25 – 34.29 this morning. USDTHB could be closed between 34.20 - 34.40 today. The Dollar Index continued the trend of strength observed last week, although the gains were relatively modest compared to those of the previous week. The dollar's movements were choppy, but after the ISM Manufacturing index for August fell short of expectations, the dollar strengthened. The Euro weakened against the dollar, primarily due to the influence of the US ISM report, which overshadowed any Euro-specific factors and reversed an earlier rebound in the currency pair. Safe-haven currencies outperformed other major currencies against the dollar, driven by declining US Treasury yields and a risk-off sentiment with falling equities. This was particularly evident in the Japanese yen, which saw increased strength.
Sources : ttb analytics , Bloomberg, CNBC, Trading economics,
Investing, CEIC
