Market Roundup 5 April 2023

1) Thai stock market overview

Thailand’s SET Index closed at 1,571.13 points, decreased 22.92 points or 1.44% with a trading value of 48 billion baht. The analyst stated that the Thai stock market fell sharply in response to the selloff in big-cap stocks, especially DELTA, amid uncertainties on Fed’s slowing rate down and rising oil prices caused concerns over recession to return.


2) Thai March inflation slows down to 2.83%

Thailand’s inflation surged at the slowest pace in 15 months in March due to lower energy and food prices, the commerce ministry said on Wednesday.

The headline Consumer Price Index (CPI) in Thailand increased 2.83% in March from the same month a year ago, which was lower than the 3.30% increase that was predicted in a Reuters poll. The core CPI index rose 1.75% from a year ago in March, compared to the expected growth of 1.82%.

For the first time in 15 months, headline inflation fell back within the central bank’s 1% to 3% target range.

The ministry stated in a statement that it now expects headline inflation to be between 1.7% and 2.7% this year, down from its earlier prediction of 2% to 3%.


3) Fed’s top official says rate target will need to exceed 5%

Federal Reserve Bank of Cleveland President Loretta Mester stated on Tuesday that the U.S. central bank will likely raise interest rates again, despite indications that recent banking sector issues have been contained.

Mester sees monetary policy moving “somewhat further into restrictive territory this year, with the fed funds rate moving above 5% and the real fed funds rate staying in positive territory for some time” to keep inflation on a sustained downward path to 2% and inflation expectations anchored.

The federal funds rate was increased by 25 basis points during the March meeting, bringing the target range to 4.75%-5%.

“In my modal projection, to put inflation on a sustained downward trajectory to 2% and to keep inflation expectations anchored, monetary policy moves somewhat further into restrictive territory this year, with the fed funds rate moving above 5% and the real fed funds rate staying in positive territory for some time,” she said.


4) Japan’s March service sector expands most in 9 years

Japan’s services sector continued to expand in March, according to a private survey conducted by the au Jibun Bank, and the economy also saw an increase in new business volumes during the month, which was the highest rate since February 2019.

The country’s purchasing managers’ index for services increased to 55 from 54 in February, marking the seventh consecutive month of expansion.

The expansion was the strongest since 2013 and the second-strongest in the survey’s history.

Business activity, new business, and export orders in Japan “accelerated on the month to reach among the highest in their respective series histories,” according to the report, which also noted that input inflation dropped to a 12-month low.

Au Jibun bank further stated that businesses were “increasingly optimistic” about their prospects for activity in the future year.