- USDTHB: moving in the range 36.08-36.14 this morning supportive level at 36.00 resistance level at 36.20
- SET Index: 1,329.4 (+0.46%), 11 July 2024
- S&P 500 Index: 5,584.5 (-0.88%), 11 July 2024
- Thai 10-year government bond yield (interpolated): 2.62 (-1.18 bps), 11 July 2024
- US 10-year treasury yield: 4.20 (-8.0 bps), 11 July 2024
- U.S. inflation eases, likely ensuring Fed rate cut
- US weekly jobless claims fall more than expected
- Stronger UK economic growth benefits new government
- The dollar tumbled on a cooler-than-expected US CPI report
U.S. inflation eases, likely ensuring Fed rate cut
U.S. inflation slowed marginally in June on an annual basis, with a key measure of core prices monitored by the Federal Reserve also indicating a reduction in pricing pressures. The U.S. Consumer Price Index (CPI) rose by 3.0% in June compared to a year earlier. Economists had anticipated a decrease to 3.1% from 3.3% in May. On a monthly basis, the CPI fell by 0.1%, a decline from the previous unchanged figure. The core CPI, which excludes volatile categories like food and energy, increased by 3.3% year-over-year, slightly down from the 3.4% rise in May. On a monthly basis, the core CPI rose by 0.1%, less than the 0.2% gain observed the previous month. Following the CPI report, Treasury yields surged, and traders nearly fully anticipated rate cuts in September and December, while also increasing the likelihood of a November rate cut to better than even odds.
US weekly jobless claims fall more than expected
The number of Americans filing new unemployment benefit applications fell more than anticipated last week. However, seasonal volatility, particularly due to auto manufacturers temporarily shutting down plants for retooling, complicates the assessment of the labor market. For the week ending July 6, initial claims for state unemployment benefits dropped by 17,000 to a seasonally adjusted 222,000, marking the lowest level since late May. Economists had projected 236,000 claims for the week. Additionally, the number of people receiving benefits after the initial week, which serves as an indicator of hiring trends, decreased by 4,000 to a seasonally adjusted 1.852 million for the week ending June 29.
Stronger UK economic growth benefits new government
Britain's economy grew faster than anticipated in May, offering a boost to Prime Minister Keir Starmer's new government but raising questions about whether the Bank of England will lower interest rates next month. According to the Office for National Statistics, economic output rose by 0.4% in May, following no growth in April. Economists had forecasted a 0.2% monthly increase. The growth in May was broad-based, with gains across services, manufacturing, and construction, the latter increasing by 1.9% due to a surge in housebuilding. As a result, the likelihood of a rate cut in three weeks fell below 50% in futures markets, compared to just above 50% on Wednesday.
The dollar tumbled on a cooler-than-expected US CPI report
The 10-year government bond yield (interpolated) on the previous trading day was 2.62, -1.18 bps. The benchmark government bond yield (LB346A) was 2.63, -2.00 bps. Meantime, the latest closed US 10-year bond yields was 4.20, -8.0 bps. USDTHB on the previous trading day closed around 36.25 moving in a range of 36.08 - 36.14 this morning. USDTHB could be closed between 36.00-36.20 today. The dollar dropped sharply following a US CPI report that was cooler than anticipated, with all components coming in below forecasts. Additionally, the data increased expectations for a rate cut by the Fed, with money markets now fully anticipating a 25-basis point reduction in September. The British pound benefitted from the broad weakness in the dollar, while monthly UK GDP data topped forecasts but had little impact. The Japanese yen surged on reported FX intervention which saw USD/JPY slide from the 161.00 handle to briefly below the 158.00 level.
Sources : ttb analytics , Bloomberg, CNBC, Trading economics, Investing, CEIC
