Mr Poon Panichpiboon, money market strategist, Krungthai GLOBAL MARKETS, Krung Thai Bank revealed that the baht opened this morning, October 3, 65 at 37.83 baht per dollar. “Appreciated slightly” from the end of the previous week at 37.85 baht per dollar. Looking at the baht frame this week at 37.50-38.30 baht per dollar. The baht frame today is expected to be at the level of 37.70-37.95 baht per dollar.
Last week The general financial market is in a closed position. Amid concerns about the global economic slowdown and high volatility in the government bond market This week, market players are expected to look forward to reports on US labor market data such as nonfarm payrolls. is another important factor that must be carefully observed
The interesting economic data reports are as follows:
US side – Market players will wait to assess the US economic outlook. through reports of important economic data, especially labor market data that the market estimates the US labor market may remain in a tight state The number of job openings may exceed 11 million, or almost double the number of unemployed. In addition, the number of nonfarm payrolls in September may be higher than 260,000, causing the unemployment rate to rise. Average Hourly Earnings may reach 5.1% y/y, which reflects a labor market still strong and boosting the Fed’s recent progress in the Dot Plot.
Market players will be keeping an eye on statements from Fed officials to assess the Fed’s views on the economic outlook and policy interest rates. after last week Fed officials have expressed their support for raising interest rates until inflation is under control, but we are starting to see some Fed officials expressing concerns about the potential impact on the economy from a Fed rate hike . This gives the possibility that the Fed may not raise interest more than what was indicated in the latest Dot Plot if the economic prospects of the United States. slowing more clearly along with the reduction in inflation.
European side – The market sees that the overall European economy is still not very bright. In August, retail sales in the euro area may contract -0.4% from the previous month. under pressure from high inflation which caused the cost of living to accelerate In addition, the issue that the market will monitor closely is the British government’s stance on the new budget plan. If the British government continues to implement economic stimulus and tax reduction plans (Or maybe cut the limit a bit) cause financial markets to continue to worry about the British government’s fiscal problems. This could cause the British government bond market to fluctuate again. The bond yield may rise. This was followed by selling pressure on long-term British government bonds and caused the pound (GBP) to depreciate.
We believe that in such a situation the Bank of England (BOE) is ready to help maintain the stability of the financial market. by temporarily buying long-term bonds This can reduce the severity of the temporary effects. Until the market is freed from fiscal policy problems and confidence in the British government is restored.
Asian side – The market estimates that Japanese entrepreneurs may begin to have a better view of the recovery of the Japanese economy. especially in the services sector After the government prepares to open the country to welcome foreign tourists, which is reflected in the third quarter business confidence index (Tankan Survey) for large and small businesses outside the industrial sector will rising to 14 points and -2 points accordingly In terms of monetary policy, the market expects the Reserve Bank of Australia (RBA) to continue raising the policy rate by 0.50% to 2.85% to curb inflation. (most recently as high as 6.1%) and reduce pressure on the AUD as well. The Reserve Bank of New Zealand (RBNZ) will increase the policy interest rate by 0.50% to 3.50% as inflation continues to rise to 7.3%.
Thai side – The market estimates that the industrial manufacturing sector could expand at a slightly slower pace in September, with the manufacturing PMI likely to fall to 53.4, following a slowdown in the economies of trading partners which affected demand for key Thai exports , however, there is the tendency to continue to exist economic recovery in the country from the tourism sector and private consumption This will support the Business Confidence Index and the Consumer Confidence Index in September. has risen to 50 and 44 points. In addition, the consumer confidence index may be under pressure from high inflation to some extent. amid rising prices of goods and services including electricity We estimate that September CPI headline inflation will remain high at around 7.2%, but is likely to begin to slow down.
Regarding the trend of the baht, it is estimated that the baht may fluctuate sideways, keeping an eye on the direction of the flow of foreign investors’ funds. If selling pressure on Thai assets begins to wane, it may help slow down the baht’s depreciation. in the short term Thai baht resistance will be in the range of 38.20-38.40 baht per dollar. This level is expected to see exporters gradually selling the dollar. The inclusion of some foreign players can gradually take Long USTHB’s profits, while the key support will be in the range of 37.50 baht per dollar, which importers are expected to wait for the baht to appreciate. to buy dollars
As for the dollar, the dollar’s momentum may begin to decline somewhat. And the dollar is likely to weaken. Amidst the tendency to intervene in the currencies of many countries, however, the dollar is ready to strengthen. If the British government insists on using plans to stimulate the economy and reduce taxes as before. This could put pressure on the pound (GBP) to weaken again.