The baht depreciated on positive US economic numbers. Markets eyeing Fed meeting while domestic factors The Minister of Finance said Thailand’s economy is in a better direction. Since the second quarter of 2021 before the market close at 33.24/25 baht / USD
Foreign Exchange Bangkok Bank reported that the movement of the foreign exchange market during 13-17 September 2021, the baht opened on Monday morning (13/9) at 32.76/78 baht/USD. It weakened from Friday’s close (10/9) at 32.64/66 baht/USD.
The U.S. dollar was boosted after the U.S. Department of Labor said. The Producer Price Index (PPI), a measure of inflation based on producer spending, rebounded 0.7% in August month-on-month. It beat forecasts of 0.6% year-on-year, with the PPI rising 8.3 percent in August after jumping 7.8 percent in July.
The core PPI, which excludes food and energy, rose 0.3 percent in August month-over-month and 6.3 percent year-on-year. Additionally, the U.S. Department of Labor released the Consumer Price Index (CPI), a measure of inflation on consumer spending that was lower than market expectations. It said the CPI rose 0.3% in August month-over-month. That was 0.4% below analysts’ expectations.
And on a year-on-year basis, the CPI rose 5.3% in August. This was lower than analysts’ estimates of 5.4%, which led investors to believe it would reduce the likelihood of the Federal Reserve (Fed) raising interest rates and cutting limits on its bond-buying program following quantitative easing. (QE)
Meanwhile, overall US industrial production rose 0.4% in August. Lower than analysts’ expectations that an increase of 0.5% in addition, the US Department of Labor said. The import price index fell 0.3% in August month-on-month, contrary to analysts’ expectations for a 0.3% gain, and was the first drop in 10 months after rising 0.4% in July.
However, the Federal Reserve Bank (Fed) New York branch reported that The manufacturing index jumped to 34.3 in September. That was higher than analysts’ forecast of 18.0 from 18.3 in August. The index remained above 0, indicating the expansion of the New York manufacturing sector. This was driven by the rebound of new orders. and employment as well as the confidence of the company in the manufacturing sector
At the end of the week, the Labor Department said the number of first-time claims for unemployment benefits rose 20,000 to 332,000 last week. It beat analysts’ forecast of 330,000, while the US Commerce Department said retail sales rose 0.7 percent in August month-over-month. Contrary to analysts’ forecasts for a 0.8% drop, driven by pre-school spending in the US.
Investors continued to hold the dollar as a safe haven after Democrats in the U.S. House of Representatives proposed raising capital gains tax and dividends to 28.8. %, one of the tax reform measures aimed at wealthy Americans. and is a key condition in the passing of the $3.5 trillion budget bill.
The new tax will be applied to those who sell shares and other assets after September 13, 2021.
Investors will keep an eye on the Federal Reserve’s (Fed) monetary policy meeting on September 21-22 for signs of a cut in the quantitative easing (QE) bond-buying program and the Fed’s interest rate hike.
For domestic factors, the baht continued to depreciate. Investors continued to closely monitor the number of COVID-19 cases after the number of new cases in the country continued to decline.
In addition, the Minister of Finance revealed that Thailand’s economic situation has improved since the second quarter of 2021 and compared to quarter-on-quarter, the situation has improved respectively. Although not very strong But the government is trying to strike a balance between health care and economic manipulation.
At the same time, they are ready to use fiscal or tax policies to help. However, the baht moved in the range of 32.75-33.23 baht/USD. Before the market close on Friday (17/9) at 33.24/25 baht/USD.
for the movement of the euro The euro opened on Monday (13/9) at 1.1806/08 USD/EUR. It weakened from Friday’s close (10/9) at $1.1842/44 USD/EUR. At the end of the week, Eurozone inflation figures for August were reported. which grew at 3% as expected and core inflation grew at 1.6% in August. However, the euro was pressured by the appreciation of the US dollar.
The euro is also under pressure after Christine Lagarde confirmed last week that Signaling a cut in PEPP does not mean that the ECB is withdrawing its economic stimulus measures it has taken since the outbreak of the coronavirus. It also stated that the ECB believes wage pressure remains mild. and supply bottlenecks will begin to subside.
Expectations that the US Federal Reserve (Fed) will decide to cut its bond purchases soon remains a risk factor that will pressure the euro to weaken. During the week, the euro moved within the range. 1.1754-1.1842 US dollar/euro and closed on Friday (17/9) at 1.1780/82 USD/Euro.
for the movement of the yen The yen opened Monday (13/9) at 109.95/97 yen/USD. It weakened slightly from Friday’s close (10/9) at 109.90/02 yen / US dollar. The yen depreciated following the appreciation of the US dollar.
However, the yen was boosted by a survey released by the Ministry of Finance and the Cabinet Office, which said business sentiment at large Japanese conglomerates in the third quarter (July-September) turned positive for the first time in a year. 3 quarters due to progress in vaccination against COVID-19 Raises expectations for economic recovery.
In addition, the industrial manufacturing index for July fell -1.5%, as expected by analysts. but dropped from 6.5% in June. In addition, at the end of the week, Japan’s Ministry of Finance revealed that August exports rose 26.2% year-on-year. That was slower from a 37% gain in July and below analysts’ expectations for a 34 percent gain. August imports jumped 44.7 percent, stronger than a 28.5 percent gain in July and good. than analysts predicted a 40 percent increase.
Japan posted a trade deficit in August of 635.4 billion yen ($5.81 billion), less than analysts’ forecast of 47 billion dollars. Orders for basic machinery, excluding machinery for the shipbuilding industry and electric utilities, rose 0.9% in July. Monthly, it hit 8597 billion yen ($7.8 billion), the first increase in two months, but below market expectations of a 3.1 percent gain.
During the week, the yen moved in the range of 109.23-110.13 Yen/US dollar and closed on Friday (17/9) at 109.94/96 yen/USD.
