China to support SMEs
USDTHB traded between 31.76-31.84 yesterday.
Before a trade deal is to be signed by President Trump and President Xi expectedly in late May, there will likely be two more meetings between US and China officials. Additionally, China is considering to shift tariffs on some key farm goods to others, asked by US, thus the Trump administration could exploit this to win the 2020 election.
According to Fed’s latest economic ‘Beige Book’ report, the US economy grew at a ‘slight-to-moderate’ pace with tight labor markets in March and early April. Seeing in January as high as 50% probability of a US recession by 2020, Goldman Sachs CEO saw less risk at the moment as the US economy was moving on at trend. In addition, the US trade deficit dropped to USD 49.4 billion in February, lowest since June 2018, largely due to rising exports to China.
Aimed at additionally boosting the economy, China authorities and policymakers are considering further stimulus measures, inclusive of lowering borrowing costs for SMEs, enabling small- and mid-sized banks to set aside less reserves, granting subsidies for new-energy vehicles and home appliances, etc.
Worse than prediction, Singapore’s March exports decreased by 11.7%, worst since October 2016, mainly on account of pharmaceutical and electronics goods.
After President Erdogan’s AK Party formally requested a new election for Istanbul following a narrow loss to the opposition, Turkish lira fell to a six-month low. Moreover, Turkey’s January unemployment reached highest in a decade and Moody’s anticipates 2% contraction in 2019 of the Turkish economy, implying weak economic fundamentals.
Moving around 31.77-31.83 this morning, USDTHB could be between 31.75-31.85 today.
US bond yields fall amid US tight labor markets
Thai 10-year government bonds (LB28DA) traded at 2.490% yesterday, +5.19 bps, while US 10-year treasury yield was at 2.59%, -1.0 bps overnight.
Thai long-dated bond yields rose, which steepened the yield curve, following the earlier overnight US treasuries.
Amid US tight labor markets reported by the Fed, US treasury yields slightly fell.
Today, Thai 10-year government bonds (LB28DA) could be trading between 2.48-2.50%.
Sources: bangkokbiznews, Bloomberg, CNBC, Investing.com, Reuters