- USDTHB: moving in the range 34.25-34.35 this morning supportive level at 34.20 resistance level at 34.40
- SET Index: 1,323.4 (+1.55%), 19 Aug 2024
- S&P 500 Index: 5,608.3 (+0.97%), 19 Aug 2024
- Thai 10-year government bond yield (interpolated): 2.544 (-1.00 bps), 19 Aug 2024
- US 10-year treasury yield: 3.86 (-3.0 bps), 19 Aug 2024
- Kashkari says it's time to consider a September rate cut
- China holds key lending rates steady, as expected
- Thailand's Q2 GDP surpassed forecasts, but policy uncertainty dims the outlook
- Dollar hits 7-month low, yen gains as traders wait on Jackson Hole
Kashkari says it's time to consider a September rate cut
Neel Kashkari, President of the Federal Reserve Bank of Minneapolis, told the Wall Street Journal that he is considering a potential interest rate cut at the next meeting due to signs of a weakening labor market. This marks a shift from his June view that a rate cut might not be necessary until later in the year. With the unemployment rate rising to 4.3% in July from 3.7% earlier, concerns about an economic slowdown have emerged. Kashkari noted that if the labor market had remained between 3.7% and 3.8%, he wouldn't be contemplating a rate cut now. However, given the progress on inflation and labor market concerns, he is open to reducing rates but prefers small adjustments, not exceeding a quarter percentage point at a time, due to stable layoffs and unemployment claims.
China holds key lending rates steady, as expected
China maintained its benchmark lending rates steady in its latest monthly adjustment, matching market forecasts. The one-year loan prime rate (LPR) remained at 3.35%, and the five-year LPR stayed at 3.85%. This decision reflects China's cautious approach, following PBOC Governor Pan Gongsheng’s statement last week that the authorities will refrain from implementing “drastic” measures while still aiming to meet Beijing’s growth targets for the year. Additionally, Chinese banks have been reluctant to lower lending rates due to their slim net interest margin, which remained at a record low of 1.54% at the end of the second quarter.
Thailand's Q2 GDP surpassed forecasts, but policy uncertainty dims the outlook
The National Economic and Social Development Council (NESDC) reported that Thailand's GDP increased by 2.3% in the second quarter compared to the same period last year, surpassing expectations of 2.2% and improving from a revised 1.6% growth in the first quarter. The growth was fueled by higher government spending, increased exports, and greater private consumption, though both public and private investments declined. On a quarterly basis, the GDP grew by a seasonally adjusted 0.8% in the second quarter, which is slower than the revised 1.2% growth from the previous quarter and below the forecasted 0.9% increase. The NESDC now anticipates GDP growth for the year to be between 2.3% and 2.8%, narrowing from the earlier forecast of 2.0% to 3.0%. However, the economic outlook is uncertain due to recent political instability following a court decision last week that removed former Prime Minister Srettha Thavisin for violating constitutional rules regarding a cabinet appointment.
Dollar hits 7-month low, yen gains as traders wait on Jackson Hole
The 10-year government bond yield (interpolated) on the previous trading day was 2.544, -1.00 bps. The benchmark government bond yield (LB346A) was 2.54, -0.5 bps. Meantime, the latest closed US 10-year bond yields was 3.86, -3.0 bps. USDTHB on the previous trading day closed around 34.45 moving in a range of 34.25 – 34.35 this morning. USDTHB could be closed between 34.20 - 34.40 today. The Dollar continued to decline, falling against all of its G10 counterparts. The dollar index dropped below 102, reaching a low of 101.85, in a session with minimal news except for comments from Fed's Kashkari. The euro gained from the weaker Dollar, hitting a new year-to-date high of 1.1085. Meanwhile, the Japanese yen fell to the lower end of the 145 range on Monday, touching a low of 145.19, but has since recovered to the 146 level.
Sources : ttb analytics , Bloomberg, CNBC, Trading economics,
Investing, CEIC
