Kaohoon Morning Brief – 2 November 2023

Finansia Syrus Securities (FSS) expected Thailand’s SET Index to make a short recovery to test the resistance level at 1,390-1,400 points from a better outlook in the market as US bond yields retreated and the Federal Reserve held rates at 5.25-5.50% as expected. Moreover, the statement from Fed’s Chairman Jerome Powell did not surprise the market, saying a sustainably 2% inflation will need time, while the committee had not made a decision for the next meeting’s rate decision.


Yesterday, the US Federal Reserve unanimously agreed to hold its policy rate at 5.25%-5.50%, while addressing that it is still a long way for inflation to achieve a sustainable level of 2%.

Fed Chair Jerome Powell said that the process of getting inflation sustainably down to 2% has a long way to go. As for the next meeting in December, the committee will do what it thinks is appropriate at the time.

In addition, Powell noted that the committee was not considering or even discussing rate reductions at this time, but stated that the risks around the Fed doing too much or too little to combat inflation have become more balanced.

The market is now pricing in a first rate cut by June next year at around 50% chance, up from mid 30% yesterday. Before the Fed announcement, the highest odds for a rate cut was around 35% in July, according to CME FedWatch Tool.


Japanese Prime Minister Fumio Kishida announced a spending of 17 trillion yen in a stimulus package to soften the impact of rising inflation on its economy. The measure will include temporary cuts to income and residential taxes as well as subsidizing gasoline and utility bills.

Inflation of the world’s third largest economy remained at 3% in September, which was higher than the Bank of Japan’s target of 2% for more than a year that put pressure on consumption.