THAILAND: Private Sector Pushing For End To Political Uncertainty
Jun-14 05:22
A month after the May election, government formation talks continue and the private sector is uncomfortable with the uncertainty that currently exists. They fear that it could slow growth. Foreign investors are also observing developments in case investment rules change.
- According to the Bangkok Post, an Election Commission (EC) source has confirmed that 330 of the MPs-elect do not face any complaints but another 50 need to be investigated, including possible PM Pita. By law 380 of the 400 constituency MPs need to be endorsed by the EC. Move Forward and the business sector have asked the EC to endorse the election results as soon as possible to reduce uncertainty.
- The BoT warned that a higher minimum wage, which was promised during the election, may amplify labour costs and boost goods prices. It remains concerned about the inflation outlook.
- The support of some senators will be needed for a new PM to be approved. Proposed changes to the law regarding insulting the monarchy have been a sticking point for many. Now the senate wants to discuss the issue with the parties likely to form government to find a middle ground.
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LOOK AHEAD: Eurozone Timeline of Key Events (Times BST)
May-15 05:18
| Date | Time | Country | Event |
| 15-May | ---- | EU | ECB Lagarde & Panetta in Eurogroup Meeting |
| 15-May | 1000 | EU | Industrial Production |
| 16-May | ---- | EU | ECB de Guindos in ECOFIN Meeting |
| 16-May | ---- | EU | GDP (p) / Trade Balance / Employment |
| 16-May | 1000 | IT | Italy Final HICP |
| 16-May | ---- | DE | ZEW Survey |
| 17-May | 1000 | EU | HICP (f) |
| 17-May | 1000 | EU | ECB Elderson Panels Beyond Growth Conference |
| 17-May | 1030 | EU | ECB Panetta Presentation on Digital Euro |
| 17-May | 1615 | EU | ECB de Guindos Closes IESE Banking Meeting |
| 18-May | 0730 | EU | ECB de Guindos Remarks at PwC Seminar |
| 19-May | 0700 | DE | PPI |
| 19-May | 1555 | EU | ECB Schnabel Speech Finance Stability Mon Policy Conf |
| 19-May | 1700 | EU | ECB Schnabel Panels Finance Stability Mon Policy Conf |
| 19-May | 2000 | EU | ECB Lagarde Video Presentation at Banco Central Brasil |
JGBS: Futures Sitting Weaker, Near Cheaps After PPI Beat
May-15 05:13
JGB futures sit near Tokyo session cheaps in afternoon trading, -24 versus settlement levels.
- Higher-than-expected April PPI, which came ahead of monthly CPI data later in the week, appears to have assisted today’s relatively weak performance.
- 5-year supply saw relatively smooth digestion with the low price coming in line with dealer expectations, although the cover ratio did decline, and the tail increased since last month's auction.
- Cash JGBs are 0.3-1.2bp weaker across the curve, except for the 2-year zone, with the curve steeper. The benchmark 10-year yield is 1.2bp higher at 0.402%, below the BoJ's YCC limit of 0.50%. The 5-year benchmark is 0.4bp cheaper at 0.111%, little changed from levels prevailing before the JGB supply.
- The swap curve bear steepens with swap spreads wider outside of the 1-year zone.
- The local calendar is light tomorrow ahead of Q1 GDP (preliminary) on Wednesday and National CPI on Friday.
- BoJ Rinban operations covering 1-10-year and 25-Year+ JGBs are scheduled for tomorrow ahead of 20-year JGB supply on Wednesday.
- Further afield, the global calendar is light ahead of tomorrow’s data dump in China, the Euro Area's Q1 GDP and US Retail Sales.
EUROSTOXX50 TECHS: (M3) Trend Needle Still Points North
May-15 05:04
- RES 4: 4520.00 High June 2001 (cont)
- RES 3: 4403.50 High Nov 18 2021 (cont) and a major resistance
- RES 2: 4381.50 High Jan 5 2022 (cont)
- RES 1: 4363.00 High Apr 21 and the bull trigger
- PRICE: 4315.00 @ 05:39 BST May 15
- SUP 1: 4239.10 50-day EMA
- SUP 2: 4233.00 Low May 4
- SUP 3: 4175.00 Low Mar 30
- SUP 4: 4164.00 High Mar 22
Eurostoxx 50 futures remain in consolidation mode. Price is trading above support at 4239.10, the 50-day EMA. The recent move down is considered corrective and the broader uptrend is intact. A resumption of gains would signal scope for a test of 4363.00, the Apr 21 high and a bull trigger. Clearance of this level would confirm a resumption of the uptrend. A clear break of the 50-day EMA is required to signal a top.
