- USDTHB: moving in the range 33.98-34.095 this morning supportive level at 33.90 resistance level at 34.30
- SET Index: 1,469.7 (+0.16%), 7 Nov 2024
- S&P 500 Index: 5,973.1 (+0.74%), 7 Nov 2024
- Thai 10-year government bond yield (interpolated): 2.444 (-0.75 bps), 7 Nov 2024
- US 10-year treasury yield: 4.31 (-11.0 bps), 7 Nov 2024
- Fed cuts rates by 0.25% amid ongoing progress against inflation
- BOE delivers rate cut with warning on budget’s inflation hit
- China's trade surplus beats expectations in October with a surge in exports
- Dollar drops as Fed cuts rates, traders unwind some Trump trades
Fed cuts rates by 0.25% amid ongoing progress against inflation
The Federal Reserve cut rates by 25 basis points to 4.50-4.75%, in line with expectations and by unanimous decision. During the conference, Fed Chair Powell noted the Fed could adjust policy more quickly or slowly depending on economic conditions, aiming for a balanced approach. Powell emphasized that recent statement changes were simply to reflect the start of easing and were not a policy signal. He also pointed out that while recent inflation data was higher than expected, economic activity has been stronger, and risks have lessened. On bond yields, Powell said it’s too early to predict their future direction, noting that yields reflect growth expectations, not higher inflation concerns. In addition, Chair Jerome Powell said he won’t step down as chair if President-elect Donald Trump asks him to leave, and that demotion of vice chairs isn’t permitted under the law.
BOE delivers rate cut with warning on budget’s inflation hit
The Bank of England cut its key rate by 25 bps to 4.75%, as expected, with an 8-1 vote split. The statement emphasized keeping the bank rate restrictive until inflation risks are better managed. Governor Bailey favored a gradual approach to easing, warning against quick or large rate cuts. The updated MPR raised inflation forecasts for 2025-2026, with the UK budget expected to add nearly 0.5 percentage points to inflation by mid-2026. At the press conference, Bailey said the MPC would monitor the budget's impact on inflation but didn’t foresee major changes to the rate path. The market views the UK budget as pushing the MPC to a more hawkish stance, with a 20% chance of a rate cut in December and 65bps of cuts by end-2025.
China's trade surplus beats expectations in October with a surge in exports
China’s trade surplus surged to $95.27 billion in October, surpassing expectations. Exports grew 12.7% year-on-year, driven by strong global demand, while imports fell 2.3%, reflecting weak domestic demand. The surplus was higher than the $81.71 billion in September and exceeded the forecasted $73.5 billion, reflecting a substantial improvement in China's external trade position.
Dollar drops as Fed cuts rates, traders unwind some Trump trades
The 10-year government bond yield (interpolated) on the previous trading day was 2.444, -0.75 bps. The benchmark government bond yield (LB346A) was 2.42, -1.00 bps. Meantime, the latest closed US 10-year bond yields was 4.31, -11.0 bps. USDTHB on the previous trading day closed around 34.36, moving in a range of 33.98 – 34.095 this morning. USDTHB could be closed between 33.90 – 34.30 today. The dollar gave back some of its post-Trump gains, weakening against all major currencies. The Fed cut the Fed Funds Rate by 25bps to 4.50%-4.75%, as expected, and the dollar saw volatile trading after Powell's press conference, where he downplayed rising Treasury yields and signaled that the Fed would monitor data for the December decision. The euro strengthened, reclaiming 1.0800, boosted by stronger-than-expected EU retail sales. The British pound also gained, supported by the BoE's 25bps rate cut and its commitment to maintaining a restrictive policy until inflation risks are more firmly under control. The Japanese yen gained ground as the dollar weakened and US yields eased, causing USD/JPY to drop from the 154.00 range to below 153.00.
Sources : ttb analytics , Bloomberg, CNBC, Trading economics, Investing, CEIC
