- USDTHB: moving in the range 36.175-36.30 this morning supportive level at 36.15 resistance level at 36.35
· SET Index: 1,399.4 (-1.68%), 20 Oct 2023
· S&P 500 Index: 4,217.0 (-1.44%), 23 Oct 2023
· Thai 10-year government bond yield (interpolated): 3.37 (-1.53 bps), 20 Oct 2023
· US 10-year treasury yield: 4.86 (-7.00 bps), 23 Oct 2023
- Fed's hawkish stance signals extended restrictive monetary policy
- German producer prices post biggest decline on record in September
- Japan's core inflation slows below 3% for first time in over a year
- Dollar falls as Treasury yields retreat
Fed's hawkish stance signals extended restrictive monetary policy Federal Reserve Chairman Jerome Powell has emphasized a commitment to an extended restrictive US monetary policy, leading to stock dips and increases in US 10-year Treasury yield and US dollar against yen. The move is designed to maintain the restrictive policy until there is confidence that inflation is sustainably down to 2% over time. Despite recent US inflation rates aligning with the Fed’s 2% target, Powell did not suggest that the mission to curb inflation had been achieved. He further indicated that significant measures of inflation are expected to decrease significantly soon. This stricter warning than investors expected contradicts recent rises in long-term US interest rates and tightening financial conditions since the last Fed rate increase.
German producer prices post biggest decline on record in September German producer prices posted their biggest year-on-year decline in September since data collection began in 1949, spurring hopes for further easing of inflation in Europe's largest economy. Producer prices fell slightly more than expected in September, decreasing by 14.7% on the year, the federal statistics office reported. Analysts polled by Reuters had expected a 14.2% decline. As a result of the war in Ukraine, the increase in producer prices in September 2022 was 45.8% on the year, the highest registered since records began. Therefore, the comparison between September 2022 and September 2023 showed a strong decline. Germany's producer prices index, considered a key inflation indicator, has been easing steadily since September of last year.
Japan's core inflation slows below 3% for first time in over a year Japan's core inflation in September slowed below the 3% threshold for the first time in over a year but stayed above the central bank target, keeping alive expectations that policymakers will phase out ultra-easy monetary policy. The data will be among a host of indicators the Bank of Japan (BOJ) will scrutinize at its two-day policy meeting ending on Oct. 31, when it produces fresh quarterly growth and price forecasts. The core consumer price index (CPI), which excludes volatile fresh food costs, rose 2.8% in September from a year earlier, government data showed on Friday, slightly exceeding a median market forecast for a 2.7% gain but easing from 3.1% in August. Utility bills fell reflecting the lagged effect of past oil price falls, helping inflation slow below 3% for the first time since August 2022.
Dollar falls as Treasury yields retreat The 10-year government bond yield (interpolated) on the previous trading day was 3.37, -1.53 bps. The benchmark government bond yield (LB31DA) was 3.37,-3.00 bps. Meantime, the latest closed US 10-year bond yields was 4.86, -7.00 bps. USDTHB on the previous trading day closed around 36.49. Moving in a range of 36.175-36.30 this morning. USDTHB could be closed between 36.15-36.35 today. The US dollar fell against a basket of currencies on Monday, tracking a retreat in US Treasury yields from the 5% level hit earlier in the session, and as traders awaited fresh US economic data due later this week. The yield on the benchmark 10-year US Treasury note declined on Monday after briefly rising above 5.0%, hitting the July 2007 milestone that it briefly attempted to scale last week and further threatening an economic slowdown on higher borrowing costs. Traders are on watch for several events this week, including a European Central Bank meeting, and the release of US GDP data and the Federal Reserve's preferred inflation gauge. But the main news on Monday was the yield on 10-year US Treasuries reaching as high as 5.021%, the latest stage of a relentless sell-off in government bond markets, driven by investors accepting central banks will keep rates persistently high, particularly in the United States, an increase in supply of bonds and widening term premia.
Sources : ttb analytics , Bloomberg, CNBC, Trading economics, Investing, CEIC
