What on Earth is “negative interest rates”, is the Sun now rising in the West? No, this is a symptom of the ECB’s counter to the Fed’s unstated policy of “Beggar Thy Neighbour”
Such expectations of more ECB actions led to a fall in 10yr Bunds, taking 10yr UST along as well as spreads widen to historical highs
Lower 10yr UST should have translated to much lower USDTHB, notwithstanding May’s transfer of power
Inclusive of such events, hopes still rest on exports given an inert domestic demand outlook
We retain our year end target for USDTHB at 33.50, not only because of its risk / return profile, but it makes the most economic sense
On the domestic front, the re-emergence of functioning fiscal policy after the coup reduces the need for further monetary policy action. MPC could afford to wait and see on how the new political paradigm unfo
Strategic Thesis
In 2010, the then finance minister of Brazil coined the modern phrase of “Currency War”, as developed economies tried to inflate their way out of deflation by utilizing non- conventional monetary policy. The “Great Recession” as it would become to be called as the sub-prime bubble got out of hand. The world economy seems to be running out of steam. After its deep recession in 2009 with global GDP contracting 2.3%, the subsequent growth recovery is increasingly tepid. Where is the evidence? Exports of about 28 key economies rebounded passed the 2008 high of USD11.7 trillion. But since 2012, the slope of world exports has flattened. If each respective country’s economic authority can not sufficiently expand the size of their economy to accommodate a ever growing labor force, the specter of social unrest would ensue. As the means of fiscal stimuli might have caused more problems than it solves, the pendulum tends to swing back to inflation targeting central banks. The Fed’s faster pace of money printing has at least two effects: 1) the Fed is exporting US deflation to the Eurozone and 2) the Fed is importing Eurozone growth to the US. Just think, wouldn’t a higher EURUSD be better for Boeing or Airbus? We have seen a broad-based deceleration in China’s economic data since the beginning of the year. Although weakness lies in the property sector, adverse events, i.e. sub-prime crisis as in the case of the U.S., are unlikely in China. On the domestic front, the re-emergence of functioning fiscal policy as another gear to drive the economy reduces the need for further monetary policy action. MPC could afford to wait and see on how the new political paradigm unfolds. On one hand, the power takeover by the Thai army brought up markets’ optimism. On the other hand, it could mean the pick up in the pace of
ขอช่วยแปลสรุปบทความภาษาอังกฤษนี้ให้หน่อยนะค่ะ จะนำมาเรียบเรียงเป็นภาษาทางการ ขอบคุณมากค่ะ^^
Such expectations of more ECB actions led to a fall in 10yr Bunds, taking 10yr UST along as well as spreads widen to historical highs
Lower 10yr UST should have translated to much lower USDTHB, notwithstanding May’s transfer of power
Inclusive of such events, hopes still rest on exports given an inert domestic demand outlook
We retain our year end target for USDTHB at 33.50, not only because of its risk / return profile, but it makes the most economic sense
On the domestic front, the re-emergence of functioning fiscal policy after the coup reduces the need for further monetary policy action. MPC could afford to wait and see on how the new political paradigm unfo
Strategic Thesis
In 2010, the then finance minister of Brazil coined the modern phrase of “Currency War”, as developed economies tried to inflate their way out of deflation by utilizing non- conventional monetary policy. The “Great Recession” as it would become to be called as the sub-prime bubble got out of hand. The world economy seems to be running out of steam. After its deep recession in 2009 with global GDP contracting 2.3%, the subsequent growth recovery is increasingly tepid. Where is the evidence? Exports of about 28 key economies rebounded passed the 2008 high of USD11.7 trillion. But since 2012, the slope of world exports has flattened. If each respective country’s economic authority can not sufficiently expand the size of their economy to accommodate a ever growing labor force, the specter of social unrest would ensue. As the means of fiscal stimuli might have caused more problems than it solves, the pendulum tends to swing back to inflation targeting central banks. The Fed’s faster pace of money printing has at least two effects: 1) the Fed is exporting US deflation to the Eurozone and 2) the Fed is importing Eurozone growth to the US. Just think, wouldn’t a higher EURUSD be better for Boeing or Airbus? We have seen a broad-based deceleration in China’s economic data since the beginning of the year. Although weakness lies in the property sector, adverse events, i.e. sub-prime crisis as in the case of the U.S., are unlikely in China. On the domestic front, the re-emergence of functioning fiscal policy as another gear to drive the economy reduces the need for further monetary policy action. MPC could afford to wait and see on how the new political paradigm unfolds. On one hand, the power takeover by the Thai army brought up markets’ optimism. On the other hand, it could mean the pick up in the pace of