- USDTHB: moving in the range 34.06-34.08 this morning supportive level at 33.90 resistance level at 34.20
- SET Index: 1,359.1 (+0.12%), 30 Aug 2024
- S&P 500 Index: 5,648.4 (+1.00%), 30 Aug 2024
- Thai 10-year government bond yield (interpolated): 2.557 (+0.66 bps), 30 Aug 2024
- US 10-year treasury yield: 3.91 (+4.0 bps), 30 Aug 2024
- The Fed's inflation gauge and strong consumer spending set the stage for a potential rate cut
- Eurozone inflation falls sharply; September rate cut likely
- China's factory activity continues to decline amid growing challenges
- South Korea’s exports rise for the 11th month, but growth slows
- The US dollar strengthened broadly as inflation data supports a smaller Fed rate cut
The Fed's inflation gauge and strong consumer spending set the stage for a potential rate cut
In July, Core PCE increased by 0.2%, aligning with previous results and forecasts. The exact figure was 0.1611%, down from last month’s 0.1818%. Annually, Core PCE rose by 2.6%, consistent with the previous rate but below the 2.7% prediction. Annualized rates for the 3-month and 6-month periods fell to 1.7% and 2.6%, respectively. Headline PCE also increased by 0.2%, improving from the prior 0.1%, with prices for goods slightly declining and service prices rising by 0.2%. The Fed is likely to view this as a positive development, although Core PCE remains slightly above the target. Additionally, Personal Income rose by 0.3%, exceeding forecasts, while consumption grew by 0.5%, as expected. Real consumption increased by 0.4%, up from the previously revised 0.3%. Solid consumer spending suggests the economy is on stable footing early in the third quarter, which may argue against a half-percentage-point rate cut by the Federal Reserve this month.
Eurozone inflation falls sharply; September rate cut likely
Eurozone inflation fell to its lowest level in three years, pointing to another European Central Bank interest rate cut next month. Eurozone consumer price growth slowed to 2.2% in August on an annual basis, from 2.6% the prior month, moving closer to the ECB's 2% target after three years of above-target price growth. Core inflation, which excludes volatile food and energy costs, eased to 2.8% from 2.9% a month earlier, also in line with expectations.
China's factory activity continues to decline amid growing challenges
In August, China’s manufacturing activity dropped to a six-month low, with the PMI falling to 49.1 from 49.4 in July, missing the 49.5 forecast. This marks the sixth straight decline, indicating contraction. The drop reflects weaker factory prices and order volumes, amid ongoing property issues and possible Western trade restrictions. Conversely, the non-manufacturing PMI rose to 50.3, slightly above the forecast and July’s 50.2, driven by summer consumption. The composite index stood at 50.1.
South Korea’s exports rise for the 11th month, but growth slows
South Korea's exports rose for the 11th month in August, but growth slowed to 11.4% from 13.9% in July due to weaker demand for chips and sluggish auto sales. Imports increased 6.0%, slower than July’s 10.5% rise, resulting in a trade surplus of $3.83 billion, up from $3.60 billion the previous month.
The US dollar strengthened broadly as inflation data supports a smaller Fed rate cut
The 10-year government bond yield (interpolated) on the previous trading day was 2.557, +0.66 bps. The benchmark government bond yield (LB346A) was 2.555, +1.5 bps. Meantime, the latest closed US 10-year bond yields was 3.91, +4.0 bps. USDTHB on the previous trading day closed around 33.98 moving in a range of 34.06 – 34.08 this morning. USDTHB could be closed between 33.90 - 34.20 today. On Friday, the Dollar Index gained for the third consecutive day, marking its first week of strength since mid-July, boosted by another U.S. data release. The Euro faced its worst week since April due to the rising dollar. The Japanese yen remained relatively stable overnight despite hotter-than-expected Tokyo CPI, with the yen trading just below its session high of 146.24.
Sources : ttb analytics , Bloomberg, CNBC, Trading economics,
Investing, CEIC
