Mr. Poon Panitchpibun, cash market strategist, Krungthai GLOBAL MARKETS, Krung Thai Financial institution, revealed that the baht opened this morning at 36.72 baht per greenback. “Strengthened barely” from the day before today’s closing degree of 36.75 baht per greenback.
Since final night time the baht moved in each instructions (going up within the vary of 36.68-36.78 baht per greenback), in keeping with the directionless motion of the greenback. Together with the worth of gold It’s because most market gamers are ready to study extra new elements, particularly the US CPI inflation fee and the outcomes of the Fed assembly (the primary essential occasion is the New Dot Plot).
The US inventory market Total, we could not have returned to a state of clear danger but. It’s because market gamers are ready to see the outcomes of the Fed assembly Nevertheless, a rally in giant tech shares, led by Apple +7.3% (led by hopes that using AI in Apple gadgets will assist enhance gross sales . newest gear), ensuing within the Nasdaq tech inventory index rising +0.88%, whereas the market’s S&P500 index closed +0.27%.
On the European inventory market aspect, the STOXX600 Index continued to say no -0.93% amid continued promoting strain on French shares (French CAC-40 Index fell greater than -1.33%) attributable to issues that the RN celebration (Nationwide Rally) which is the farthest French celebration There’s a likelihood to get a majority within the parliament within the upcoming elections. That is inflicting some market gamers to begin worrying about the opportunity of Frexit taking place once more.
As for the bond market, the US 10-year bond yield remains to be fluctuating across the 4.40% degree after market gamers await the US CPI inflation report and the outcomes of the Fed assembly long-term bonds This as a result of the central banks’ coverage rate of interest transfer has regularly entered recession. (Though the Fed could cut back rates of interest extra slowly than we estimated within the July 31 – August 1 assembly), giving each minute rise in US 10-year bond yields an opportunity has regularly purchased long-term bonds (If the US 10-year bond yield rises above 4.50%, it may also be thought of an fascinating shopping for level.)
On the aspect of the cash market The greenback strikes ahead as a result of most market gamers are ready for the US CPI inflation fee and the outcomes of the Fed assembly to see some markets Earlier than figuring out the essential elements the this week as talked about Consequently, the entire Greenback Index (DXY) continues to oscillate close to the extent of 105.3 factors (oscillating inside a variety of 105.2-105.5 factors). gold value motion (COMEX gold contract for August supply) nonetheless with out clear course. After market gamers wait to study extra about new objects, in the meantime, some market gamers are profiting from the rebound in gold costs to promote regularly to make a revenue. Consequently, the general value of gold continues to fluctuate across the vary of two,332 {dollars} per ounce.
In the present day’s highlights are the US CPI inflation report for Could. (Regularly acknowledged at 7:30 pm Thailand time) anticipated by market gamers US inflation fee It would are typically slower. Particularly by way of month-to-month momentum (% m/m). Thailand time) we count on the Fed to maintain the coverage rate of interest at a degree of 5.25-5.50%, however there’s a likelihood that the brand new rate of interest forecast or Dot Plot signifies that the Fed could lower rates of interest round 2 instances this yr and 3-4 instances. in 2025, together with 2026. As for long-term (Longer Run) rates of interest, they could transfer barely larger to 2.75%.
On the Thai aspect Market gamers will wait to see the outcomes of the assembly of the Financial Coverage Committee (MPC), which can be identified regularly at 2:00 pm We imagine that the MPC will preserve rates of interest at 2.50% with a unanimous decision of 5 -2 , however market gamers can be within the MPC’s view of the financial outlook. (Will there be additional modifications to financial forecasts?) and signifies the outlook for financial coverage.
And along with the above elements Political points in Thailand, similar to contemplating the dissolution of the Kaewklai Get together Will probably be one other issue that market gamers are additionally watching.
For the motion of the baht worth We assess that The baht tends to fluctuate in each instructions across the degree of 36.60-36.80 baht per greenback. Within the interval earlier than the market regularly acknowledges essential elements as we speak, nonetheless, one ought to be cautious concerning the fluctuations in baht throughout the interval that the market is regularly recognizing them. Political danger elements within the nation This may occasionally have an effect on the attitudes of overseas traders in the direction of investing in Thai property. And throughout the interval when the market is regularly conscious of the outcomes of the MPC assembly, if the MPC sends a sign that it is able to cut back rates of interest or “shock” the market by decrease rates of interest. (We expect the possibility of this taking place may be very low) It might not be tough to place strain on the floating baht to depreciate.
And after the market regularly turns into conscious of the elements in these international locations, we imagine that the baht could begin to change sideways once more earlier than altering larger because the market regularly a ‘ develop into conscious of the US CPI inflation fee and the outcomes of the Fed assembly. If such data is reported and the newest Dot Plot from the Fed provides the market that confidence The Fed will be capable to lower rates of interest about 2 instances this yr. That might include a rise within the gold value as properly (hope to see if the gold value will be capable to rise to check the protecting zone of two,380-2,400 {dollars} per ounce or not).
We’re of the identical opinion. The baht nonetheless has room to maneuver and alter accordingly. Adjustments in elements affecting the course of the baht, similar to market gamers’ views on the Fed’s rate of interest transfer Consequently, market gamers ought to use a number of methods to hedge dangers. Both utilizing instruments like Choices or native foreign money. It will enhance effectivity in hedging trade fee danger.
Trying on the baht as we speak It’s anticipated to be on the degree of 36.60-36.80 baht / greenback within the interval earlier than the market receives essential US information studies regularly. and the outcomes of the Fed’s FOMC assembly
and consider the baht vary at 36.50-37.00 baht / greenback throughout the interval when the market regularly receives the US CPI inflation report back to the outcomes of the Fed’s FOMC assembly.
2024-06-12 02:34:00
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