- USDTHB: moving in the range 32.42-32.505 this morning supportive level at 32.30 resistance level at 32.60
- SET Index: 1,448.8 (-0.09%), 30 Sep 2024
- S&P 500 Index: 5,762.5 (+0.4%), 30 Sep 2024
- Thai 10-year government bond yield (interpolated): 2.483 (-1.30 bps), 30 Sep 2024
- US 10-year treasury yield: 3.81 (+5.00 bps), 30 Sep 2024
- Fed Chair Powell says there's no rush to cut rates as economic confidence grows
- German inflation eases, spurring hopes for another ECB cut
- China's weak factory activity highlights urgent need for stimulus
- Dollar rises as Fed's Powell takes a hawkish stance on the economy
Fed Chair Powell says there's no rush to cut rates as economic confidence grows
Fed Chair Powell reiterated his September comments, noting the Fed isn't in a hurry to cut rates. He suggested that if the economy continues as expected, there could be two 25-basis-point cuts this year, countering expectations for a larger reduction. He highlighted that revisions to Gross Domestic Income and Personal Income have reduced downside risks. Powell also indicated that the savings rate revisions suggest healthy spending can continue. While he’s monitoring productivity, he feels it’s too early to determine if improvements will last. On the labor market, he stated that job creation may not suffice to keep the unemployment rate steady amid rising supply, acknowledging that while the labor market remains solid, it has "cooled" and doesn’t need to cool further to lower inflation.
German inflation eases, spurring hopes for another ECB cut
German inflation dropped to its lowest level since February 2021 this month, bolstering the case for another interest rate cut by the European Central Bank next month. In September, German inflation decreased to 1.8%, below the market expectation of 1.9%, following a 2.0% year-on-year rise in consumer prices in August. This decline is largely attributed to favorable energy price base effects, with energy prices falling 7.6% year-on-year in September, which helped counter a slight increase in food inflation that rose to 1.6% from 1.5% in August. Additionally, services inflation, which had been relatively stable in previous months, edged down to 3.8% in September from 3.9% in August. Core inflation, which excludes volatile food and energy prices, also decreased to 2.7% in September from 2.8% in August.
China's weak factory activity highlights urgent need for stimulus
China's factory activity contracted for the fifth month in a row, and the services sector saw a notable slowdown in September. This suggests that Beijing will need to implement additional stimulus measures to meet its 2024 growth target with just three months left in the year. The data highlights a persistent economic slump, even as Chinese officials prepare to announce a comprehensive growth-boosting package. The National Bureau of Statistics (NBS) reported a slight increase in the purchasing managers' index (PMI) to 49.8 in September, up from 49.1 in August and surpassing the median forecast of 49.5, marking the highest reading in five months.
Dollar rises as Fed's Powell takes a hawkish stance on the economy
The 10-year government bond yield (interpolated) on the previous trading day was 2.483, -1.30 bps. The benchmark government bond yield (LB346A) was 2.485, -0.5 bps. Meantime, the latest closed US 10-year bond yields was 3.81, +6.00 bps. USDTHB on the previous trading day closed around 32.26 moving in a range of 32.45 – 32.505 this morning. USDTHB could be closed between 32.30 – 32.60 today. The dollar climbed throughout the day, boosted by Fed Chair Powell's hawkish comments at the NABE conference. The euro initially rose in the European session but failed to stay above 1.12, impacted by lower-than-expected German inflation, which contributed to a trend of soft inflation reports in Europe. The euro then weakened significantly after Powell's remarks, deepening its intraday decline. Meanwhile, the Japanese yen also fell against the dollar, with USD/JPY returning to the 143.00 level as US yields increased following Powell's statements.
Sources : ttb analytics , Bloomberg, CNBC, Trading economics, Investing, CEIC
