Global Economy
- Massive vaccination campaigns around the world sent the number of vaccinated people to rise, resulting in returning economic act ivities in many countries. IMF advanced economic projections, mainly in U.S. and Europe. Despite ongoing vaccination, global cases are still on the rise due to severe outbreak in India.
- Government stimulus boasted U.S. economy in March. Retail sales significantly increased while inflation (CPI) rose above 2.5%. Moreover, U.S. unemployment rate dropped to 6%. Service sector outlook improved in European countries due to vaccination.
- China posted strong GDP growth in 1 st quarter. With the impact of contracted economy from last year, China’s economic activities grew massively in retail sales, industrial production, and investment. Japan still affected by ongoing Covid 19 outbreak. Inflation rate continued contraction f or the fifth month
Domestic Economy
- Overall, Thai economy in February slightly improved due to a second wave of domestic outbreak coming under control. Regarding risk, a recurring third wave of domestic infection in April21 does hamper Thailand’s economic recovery path and could potentially delay an effective plan for re opening border to foreigners.
- External sectors (except international travelling) continued its recovery trend. Merchandise exports recovered to nearly all destination owing to global economic recovery. Foreign tourists however declined from all markets due to a new round outbreak globally.
- Domestic activities improved but remained in weak conditions. Private consumption contracted from last year but expressed a positive momentum. However, supportive factors were fragile, but government stimulus could help sustain consumption. Numbers of Thai tourists rebounded in Feb21. In the meantime, private investment showed positive momentum in machinery and equipment in accordance with improved business sentiment and the rebound of merchandise exports.
Only, construction sector and Real estate sector were in weak condition. Government’s spending especially public investment were di sbu rsed at greater degree from last year. Regarding inflation, HCPI edged up from last month due to an increase in energy price and a marginal increase in core inflation.
Financial Market
- Faster than expected US Inflation (2.6% on March) has driven UST yield curve to be temporally flatten and DXY index to drop to 6 weeks lowest level at 91.20 as US markets shift to price in Fed rate rise next year. However, Fed chair still emphasized that inflation will not above 2 per cen t for a prolonged period.
- Though USDTHB has been impacted directly from weakening USD, USDTHB trend is still in ongoing uptrend this year. Slower than expected Thai Economy as a result of 3rd round of covid 19 and prolonged negative current account are main drivers.
- LT TGB will continue to move along with LT UST. ST TGB will be fluctuated in small range with upside risk in price.
