- SET Index: 1,508.4 (-0.09%), 11 Feb 2020
- S&P 500 Index: 3,934.8 (+0.47%), 12 Feb 2020
- Thai 10-year government bond yield: 1.29 (+0.00 bps), 11 Feb 2020
- US 10-year treasury yield: 1.20% (+4.00 bps), 12 Feb 2020
- Nikkei back above 30,000 after more than three decades
- Thailand’s 4Q GDP Contracts 4.2%, Beating Economists’ Forecast of Dropping 5.4%
- Lending to Italy for a century
- Dollar Index Struggles to Find Momentum
Nikkei back above 30,000 after more than three decades
Japan's Nikkei share average rose above the 30,000 level for the first time in more than 30 years on Monday, as it regained the ground lost during decades of economic stagnation. The break of 30,000 could open the way for test of all-time high of 38,957, touched at the end of 1989. The Nikkei's epic downfall since then even dwarfed the Wall Street's worst bear market after the Great Depression. The Dow Jones Industrial Average took 25 years to recover to its previous peak. None of the Japanese banks that topped the list of companies with biggest market capitalisation in 1990 exist now, as they subsequently suffered massive loan losses and repeated mergers to survive.
Thailand’s 4Q GDP Contracts 4.2%, Beating Economists’ Forecast of Dropping 5.4%
The Office of the National Economic and Social Development Council (NESDC) on Monday has announced that Thailand 4Q20 GDP contracted 4.2%, which was better than an estimation of 5.4% contraction due to the recovery in consumption and private sector’s expansion. Real gross domestic product shrank 6.1% in 2020 compared with the previous year. Meanwhile, NESDC downgraded GDP in 2021 from 3.5-4.5% to 2.5-3.5%. Current account is expected at a surplus of 12.4 billion dollars. Exports are forecast to expand 5.8% in 2021, and imports to grow 6.5%. Inflation in 2021 is expected at 1.2% from a speculation of 0.7-1.7%.
Lending to Italy for a century
If ultra-long 50-year bonds are going like hot cakes in Europe, the temptation to double up maturities and lock in the lowest borrowing rates in history for a century is pretty compelling. Italy is forecast to running a debt-to-GDP ratio close to 160% this year and next. Yet, Spain's debut 50-year bond this week was 13 times oversubscribed for a sale of 5 billion euros - and with a yield of just 1.65%. So the demand for ultras is clearly still there in the current environment at least. Italy's Treasury sold 50-year bonds for the first time in 2016 with a coupon of 2.8%. After a brief wobble this year the yield on that issue has returned toward record lows of about 1.7% hit at the start of the year.
Dollar Index Struggles to Find Momentum
The benchmark government bond yield (LB29DA, 8.8 years) on the previous trading day was 1.29, +0.00 bps. Thai benchmark government bond yield (LB29DA) could be between 1.27-1.31. Meantime, the latest closed US 10-year bond yields was 1.20%, +4.00bps. USDTHB on the previous trading day closed around 29.87 Moving in a range from 29.84-29.89 this morning. USDTHB could be between 29.83-29.90 today. Meantime, The dollar index bottomed around 90.30 on Monday, as money continued to flow into riskier currencies amid prospects of a robust economic recovery.
Sources : Bloomberg, CNBC, Investing, CEIC
