- USDTHB: moving in the range 36.405-36.43 this morning supportive level at 36.30 resistance level at 36.55
- SET Index: 1,319.9 (-0.20%), 9 July 2024
- S&P 500 Index: 5,577.0 (+0.07%), 9 July 2024
- Thai 10-year government bond yield (interpolated): 2.66 (-0.58 bps), 9 July 2024
- US 10-year treasury yield: 4.30 (+2.0 bps), 9 July 2024
- Chair Powell largely stuck to the script at the Senate testimony
- Australia's consumer sentiment worsened due to concerns about rates and inflation
- Taiwan sees 28-month high in export and import growth for June
- Dollar remained within a narrow range following Fed Chair Powell's remarks
Chair Powell largely stuck to the script at the Senate testimony
Fed Chair Powell indicated that more positive data would enhance their confidence in managing inflation. He noted that high inflation is not the only challenge the Fed faces; reducing restrictions too late or insufficiently could weaken the economy and job market, but cutting back too early or excessively could jeopardize progress against inflation. Powell emphasized that the current restrictive policy is effectively applying downward pressure on inflation, and decisions are made on a meeting-by-meeting basis. He mentioned that the Q1 data did not justify greater confidence in the inflation trajectory necessary for a rate cut, and that reducing rates is premature until there is stronger evidence that inflation is sustainably moving towards 2%. Additionally, Powell stated that he is not providing any indications about the timing of future Fed policy actions today, and that any rate cuts will be determined based on future data and labor market conditions.
Australia's consumer sentiment worsened due to concerns about rates and inflation
Australian consumer sentiment worsened in early-July, coming close to its weakest level since the COVID-19 pandemic as sticky inflation saw consumers grow more fearful of higher interest rates. The Westpac-Melbourne Institute consumer sentiment index fell 1.1% in July, compared to a 1.7% rise in the prior month. Sentiment was battered chiefly by three consecutive months of stronger-than-expected inflation prints, which ramped up expectations that the Reserve Bank of Australia could hike rates further this year.
Taiwan sees 28-month high in export and import growth for June
Taiwan's trade figures exceeded expectations significantly. Exports surged by 23.5% year-on-year (YoY) and imports increased by 33.9% YoY, surpassing both market and projected forecasts. This strong performance can be attributed to Taiwan's pivotal role in the rapidly expanding artificial intelligence (AI) sector, although comparisons are influenced by a low base period. Notably, machinery and electrical equipment led export growth, rising by 32.8% YoY. Taiwan saw robust growth in exports to the US (74.2%) and ASEAN countries (30.9%), with a recovery in exports to Mainland China & Hong Kong (7.3%) and Europe (7.4%), contributing to overall export gains. Despite these positive developments, the trade surplus narrowed to USD 4.7 billion, falling short of expectations and impacting GDP growth.
Dollar remained within a narrow range following Fed Chair Powell's remarks
The 10-year government bond yield (interpolated) on the previous trading day was 2.66, -0.58 bps. The benchmark government bond yield (LB346A) was 2.67, -2.00 bps. Meantime, the latest closed US 10-year bond yields was 4.30, +2.0 bps. USDTHB on the previous trading day closed around 36.43 moving in a range of 36.405 - 36.43 this morning. USDTHB could be closed between 36.30-36.55 today. The Dollar Index was firmer, albeit in a contained range on Tuesday, and peaked at 105.20, against an earlier trough of 104.95. The Greenback saw initial downside in response to a text release from Fed Chair Powell, but swiftly pared losses. The Euro marginally softened but retained the 1.0800 handle against the dollar as the latest ECB rhetoric provided little. The Japanese yen underperformed amongst its G10 FX peers, causing USD/JPY to rise back to the 161.00 level.
Sources : ttb analytics , Bloomberg, CNBC, Trading economics, Investing, CEIC
