PM May proposes 2nd Brexit referendum
Against the dollar, Thai baht was weaker, trading between 31.81-31.94 yesterday and closed around 31.88.
After the Huawei ban was softened as exempted for three months, Huawei CEO said that this move of the US was meaningless, while the US underestimated Huawei’s preparedness and 5G advancement. Moreover, President Xi recently visiting a rare-earth factory raised a threat of cutting off rare-earth exports to the US where 80% of the exports are from China and rare-earth elements are crucial in the production of autos, renewable energy, defense, and technology. Additionally, according to Supawut Saichua, one of Thailand’s top economists, said that, due to outsized negotiation gaps and merely little trust left between the two superpowers, US-China trade situations already reached a dead end.
As the Fed’s QT is to end in September 2019, Wells Fargo estimated that the Fed would recommence large-scale purchases of US treasuries next year, in which the Fed’s balance sheet would increase by more than USD 2 trillion in the next decade.
Given UK MPs approving PM May’s upcoming fourth Brexit deal, inclusive of new agreements on workers’ rights, the Irish backstop, and a customs compromise, PM May proposed the MPs a vote on whether to have a second Brexit referendum. In addition, PM May was reportedly to depart the position by 30 June with Former Foreign Secretary Boris Johnson likely to be the next Conservative leader, while JPMorgan besides predicted him to be the next UK PM.
Concerning over the global economic slowdown and geopolitical uncertainties, the OECD has revised down the world growth estimate to 3.2% from 3.3% in March 2019, while 3.5% in November 2018.
Amid reported Thai GDP growth lowest in more than four years and the ongoing US-China trade dispute adversely affecting supply chains, Thai April exports and imports both shrank by 2.52% and 0.72%, respectively.
Moving between 31.94-31.99 this morning, USDTHB could be between 31.92-32.02 today.
US treasury yields of 6-month and longer tenors keep rising before FOMC minutes
Thai 10-year government bonds (LB28DA) yesterday yielded 2.450%, +0.11 bps.
Thai and US 10-year government bond yields yesterday closed at 2.548%, +1.11 bps, and 2.43%, +2.0 bps, respectively.
Before the release of the FOMC minutes, the US treasury yields of 6-month and longer tenors kept rising.
Today, Thai 10-year government bonds (LB28DA) could yield between 2.44-2.46%.
Sources: bangkokbiznews, BBC, Bloomberg, CNBC, CNN, Investing.com, Reuters