- USDTHB: moving in the range 36.27-36.32 this morning supportive level at 36.20 resistance level at 36.40
- SET Index: 1,323.3 (+0.25%), 10 July 2024
- S&P 500 Index: 5,633.9 (+1.02%), 10 July 2024
- Thai 10-year government bond yield (interpolated): 2.63 (-3.07 bps), 10 July 2024
- US 10-year treasury yield: 4.28 (-2.0 bps), 10 July 2024
- •Powell's second day of testimony reiterated that more convincing data is needed
- US wholesale inventories rise in May
- China CPI inflation slows in June, PPI shrinks at slowest pace in 16 months
- The dollar index traded within a very narrow range as traders awaited the US CPI data
Powell's second day of testimony reiterated that more convincing data is needed
Fed Chair Powell acknowledged significant progress on reducing the balance sheet but noted that there is still more work ahead and pinpointing the exact stopping point remains challenging. He mentioned that a gradual approach might offer more flexibility. Powell reiterated his stance against waiting for inflation to reach 2% before easing policy, emphasizing the need for greater confidence, which entails more positive inflation data. While Powell is somewhat optimistic about inflation decreasing, he is not yet ready to express full confidence that it will sustainably fall to 2%.
US wholesale inventories rise in May
U.S. wholesale inventories saw a solid increase in May, suggesting that inventory investment may contribute to economic growth in the second quarter. According to the Commerce Department's Census Bureau, wholesale inventories grew by 0.6%, matching last month's estimate. This follows a 0.2% rise in April. Economists had anticipated no change in inventory figures. Year-over-year, inventories decreased by 0.5% in May. Private inventory investment has been a drag on GDP for the past two quarters, as businesses managed their stocks cautiously amid strong domestic demand.
China CPI inflation slows in June, PPI shrinks at slowest pace in 16 months
In June, Chinese consumer inflation decreased as ongoing worries about China's economic outlook kept spending subdued. The Consumer Price Index (CPI) inflation rose by 0.2% year-on-year in June, which was below the anticipated 0.4% and down from 0.3% in May. On a month-to-month basis, CPI inflation dropped by 0.2%, compared to the expected decrease of 0.1%, worsening from a 0.1% decline in May. This suggests a continued deflationary trend in China. On the other hand, Producer Price Index (PPI) inflation showed some improvement in June, contracting by 0.8%, which was in line with expectations and better than the 1.4% decline in the previous month. This was the smallest PPI inflation contraction since February 2023, supported by ongoing government aid for the manufacturing sector.
The dollar index traded within a very narrow range as traders awaited the US CPI data.
The 10-year government bond yield (interpolated) on the previous trading day was 2.63, -3.07 bps. The benchmark government bond yield (LB346A) was 2.65, -2.00 bps. Meantime, the latest closed US 10-year bond yields was 4.28, -2.0 bps. USDTHB on the previous trading day closed around 36.39 moving in a range of 36.27 - 36.32 this morning. USDTHB could be closed between 36.20-36.40 today. The dollar was rangebound and just about retained the 105.00 status heading into Thursday's CPI release, while Fed Chair Powell largely echoed remarks from the prior day's testimony. The Euro marginally gained against the greenback with pertinent drivers light ahead of the ECB quiet period beginning on Thursday. The British Pound outperformed following hawkish remarks by BoE's Pill who noted that annual services price inflation and wage growth continue to point to uncomfortable strength in those underlying inflation dynamics. The Japanese yen JPY continued to weaken which saw USD/JPY gain a firmer footing at the 161.00 handle although has since pulled back from its intraday peak of around 161.80.
Sources : ttb analytics , Bloomberg, CNBC, Trading economics, Investing, CEIC
