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All major APAC and most European equity indices closed higher,
while US markets were mixed. US and benchmark European government
bonds closed sharply lower. European iTraxx was close to unchanged
across IG and high yield, and CDX-NA was modestly tighter on the
day. Copper closed lower, the US dollar was flat, and natural gas,
oil, gold, and silver were higher on the day.
Please note that we are now including a link to the profiles of
contributing authors who are available for one-on-one discussions
through our newly launched Experts
by IHS Markit platform.
Americas
Major US equity indices closed mixed, with the S&P 500
+0.3% closing at another new all-time high; DJIA +0.7%, Russell
2000 flat, and Nasdaq -0.1%.
10yr US govt bonds closed +4bps/1.53% yield and 30yr bonds
+5bps/2.15% yield.
CDX-NAIG closed -1bp/47bps and CDX-NAHY -3bps/270bps, which is
-4bps and -17bps week-over-week, respectively.
DXY US dollar index closed flat/91.85.
Gold closed +0.1%/$1,778 per troy oz, silver +0.1%/$26.09 per
troy oz, and copper -0.4%/$4.29 per pound.
Crude oil closed +1.0%/$74.05 per barrel and natural gas closed
+2.4%/$3.52 per mmbtu.
US personal income decreased 2.0% in May and real disposable
personal income (DPI) declined 2.8%. The decrease in personal
income for May reflected declines in economic impact payments
(stimulus checks) distributed through the American Rescue Plan
(ARP) Act. Economic impact payments were an estimated $11 billion
(not annualized), down from $57 billion in April and $337 billion
in March. (IHS Markit Economists James
Bohnaker and David
Deull)
Unemployment insurance receipts also decreased, but the decline
was not yet reflective of states' early termination of their
participation in pandemic-related emergency unemployment programs.
This will reduce personal income beginning in June and July.
Real personal consumption expenditures (PCE) declined 0.4% in
May in contrast to our expectation for a small gain. We revised
down our estimate for second-quarter growth in real PCE 1.7
percentage points to 10.5%.
Real PCE for durable goods eased 4.3% in May as consumers
pulled back on purchases of vehicles, recreational goods,
furniture, and other household goods.
The core PCE price index increased 0.5% in May, following
strong gains of 0.4% in March and 0.7% in April. We expect that
recent price pressures, particularly for certain goods where
supply-chain disruptions have resulted in higher consumer prices,
will ease over the next several quarters. Commodity prices are
already retreating; the IHS Markit Materials Price Index declined
for the fifth consecutive week during the week beginning 14
June.
The US University of Michigan Consumer Sentiment Index rose 2.6
points (3.1%) from its May level to 85.5 in the final June reading.
This was a modest 0.9 point beneath the preliminary reading for the
month. The level of the index has been largely stable since a
sizable increase in March. (IHS Markit Economists James
Bohnaker and David
Deull)
The June increase in consumer sentiment was driven by
expectations, the index for which rose 4.7 points to 83.5, a new
pandemic-era high. In contrast, the index measuring views on the
present situation fell 0.9 point in June to 88.6. This represented
a pivot from the preliminary reading, when a small increase in the
present situation index was recorded.
The headline increase was driven mainly by upper-income
households. The index of sentiment for households earning more than
$75,000 a year rose 2.9 points to 89.8, while sentiment for
households earning less than this rose 0.3 point to 79.6.
Supporting the increase in expectations was a record high (56%)
in the proportion expecting a decline in the unemployment rate in
the next year.
The expected one-year inflation rate stepped back to 4.2% from
a reading of 4.6% the prior month, but was 0.2 percentage point
higher than in the preliminary reading. This within-month shift
aligned with the fall in the present situation index, suggesting
that inflation is a major factor in consumers' views on current
conditions. Net negative references to prices of homes, autos, and
durable goods were again the greatest since 1974.
Views on buying conditions for big-ticket items worsened to
multi-decade lows in June and fell more as the month progressed.
The index of buying conditions for large household durable goods
rose 1 point to 111, but that of vehicles fell 13 points to 87,
while that of homes dove 16 points to 74. Both were the lowest
since 1982.
Still, the survey suggests that consumers expect the surge in
inflation to be transitory. In June, the expected 5-10-year
inflation rate fell 0.2 percentage point to 2.8% and was unchanged
through the end of the month.
US states in the West and Northeast accounted for most of the
country's nonfarm payroll employment growth again in May 2021 as
pandemic business restrictions were eased. The South had dominated
job growth over the final four months of late 2020 as state leaders
began removing containment measures on an earlier timeline, but the
South fell behind the Northeast and West in early 2021. Meanwhile,
the job recovery in the Midwest stalled out over April and May with
modest declines in both months. Nationally, growth over April and
May represented a downshift from the pace over the first three
months. All regions, except for the West, have seen growth
decelerate over the last two months relative to the first three
months of 2021, with the West far outpacing the other regions
during this time. (IHS Markit Economist James
Kelly)
Ford Motor Company chief technology officer (CTO) Ken
Washington is to leave the automaker on 16 July to take up the post
of vice-president of software engineering at Amazon. Automotive
News reports the move, citing an internal Ford memo. The report
states that Jim Buckowski, director of electrical and electronics
systems research and innovation, is oversee Ford's research and
advanced engineering team until a replacement is named. (IHS Markit
AutoIntelligence's Stephanie
Brinley)
Local Motors and Protean Electric have entered a three-year
supply agreement worth USD7.3 million, according to a company
statement. Under this deal, Protean Electric will supply thousands
of its ProteanDrive in-wheel motors (IWMs) to power Local Motors'
Olli 2.0 electric autonomous shuttles. The use of in-wheel motors
is expected to maximize passenger space, vehicle range and platform
reliability, while unlocking cost benefits. This partnership is
also expected to accelerate the rollout of the Olli 2.0 around the
world. (IHS Markit Automotive Mobility's Surabhi Rajpal)
BMW's investment arm, BMW i Ventures, has invested an
undisclosed amount in autonomous truck startup Kodiak Robotics,
according to a company statement. Kodiak will use the injected
capital to expand its workforce and fleet, as well as continuing to
improve its autonomous technology for long-haul freight transport.
(IHS Markit Automotive Mobility's Surabhi Rajpal)
The Biden administration placed extensive import and export
restrictions on producers of polysilicon products in the Xinjiang
region of China on 24 June, saying there is compelling evidence
they are using forced labor involving the region's ethnic Uyghur
population. The affected firms are Hoshine Silicon Industry, Daqo
New Energy, East Hope Nonferrous Metals, GCL New Energy Material
Technology, and XPCC. The US banned imports of goods or materials
produced or derived from silica-based products made by Hoshine, a
manufacturer of polysilicon used to produce solar panels. It also
placed XPCC and the Xinjiang operations of Hoshine, Daqo, East
Hope, and GCL on what is known as the entity list, meaning US firms
seeking to export, re-export, or engage in in-country transfers of
technology and goods must first get the green light from the
Department of Commerce. (IHS Markit Climate and Sustainability
News)
Led by soaring sales of hybrid vehicles, the overall share of
electrified light-duty vehicles hit a record 8.4% in the US in
April, according to data from IHS Markit. As recently as December
2020, the share was below 5%. In April, hybrids accounted for 6.1%
of all new vehicles registered and EVs accounted for 2.4%. While
not offering zero emissions in the manner of a pure electric
vehicle (EV), IHS Markit analysts said the vehicles powered by a
combination of gasoline and batteries provide consumers with the
comfort level of using a familiar technology, while enabling them
to purchase a car with better mileage and lower emissions. (IHS
Markit Climate and Sustainability News' Kevin Adler)
Eisai (Japan) and Biogen (US) have jointly announced that the
US FDA has granted breakthrough therapy designation to their
investigational anti-amyloid beta protofibril antibody, lecanemab
(BAN2401), for the treatment of Alzheimer's disease (AD). The
breakthrough therapy designation was based on recently published
results from a Phase IIb clinical study (Study 201) of 856 patients
with mild cognitive impairment (MCI) due to AD and mild AD with
confirmed presence of amyloid build-up. A pre-specified analysis
from the study had shown a consistent reduction of clinical decline
across several clinical and biomarker endpoints at lecanemab's
highest doses. (IHS Markit Life Sciences' Milena
Izmirlieva)
Europe/Middle East/Africa
Most major European equity indices closed higher except for
France -0.1%; UK/Italy +0.4%, Spain +0.2%, and Germany +0.1%.
10yr European govt bonds closed sharply lower;
France/Italy/Spain +5bps and UK/Germany +4bps.
iTraxx-Europe closed flat/46bps and iTraxx-Xover -2bps/225bps,
which is -3bps and -15bps week-over-week, respectively.
Brent crude closed +0.8%/$75.38 per barrel.
The BoE's Monetary Policy Committee (MPC) voted unanimously to
maintain the Bank Rate at 0.1% at its meeting that ended on 23
June. (IHS Markit Economist Raj
Badiani)
The MPC also voted unanimously to maintain the stock of
sterling non-financial investment-grade corporate bond purchases at
GBP20 billion (USD28 billion), financed by the issuance of central
bank reserves.
However, the MPC voted by a majority of 8-1 to continue with
the BoE's existing program of UK government bond purchases,
financed by the issuance of central bank reserves, maintaining the
target for the stock of these government bond purchases at GBP875
billion and hence the total target stock of asset purchases at
GBP895 billion.
The dissenting voice remained the outgoing chief economist Andy
Haldane, who was attending his last meeting. He continued to argue
that inflation could spiral upwards and stay too high. He wants to
reduce the target for the stock of the government bond purchases
from GBP875 billion to GBP825 billion.
As of 22 June, the total stock of the Asset Purchase Facility
(APF) was GBP823 billion. The BoE reports that GBP78 billion of the
planned purchases of GBP150 billion of assets in 2021 had been
completed. The BoE said in its previous meeting that it was ahead
of target for the year, and "the pace of these continuing purchases
could now be slowed somewhat".
According to the UK Office for National Statistics (ONS), the
number of payrolled employees increased for the sixth consecutive
month, up by 197,000, or 0.7% month on month (m/m), in May to 28.5
million. Nevertheless, it remained 553,000 below the levels seen
before the COVID-19 virus pandemic. (IHS Markit Economist Raj
Badiani)
The ONS reported that total UK employment (all aged 16 plus)
increased by 113,000 quarter on quarter (q/q), or 0.3% q/q, to 32.5
million in the three months to April 2021, compared with the three
months to January 2020.
The number of unemployed people based on the Labour Force
Survey (LFS) or the International Labour Organization (ILO) measure
decreased by 90,000 in the three months to April, standing at 1.675
million.
The UK unemployment rate stood at 4.7% in the three months to
April, down from 5.0% in the three months to January. The drop in
unemployment was because of rising employment, while the economic
inactivity rate was largely unchanged on the previous quarter at
21.0%.
The pace of job losses continued to slow. The number of
redundancies decreased by 42,000 to 111,000 in February-April,
compared with the three months to January. This represents a
redundancy rate of 4.0 per 1,000, down from 11.0 in November
2020-January 2021.
Furthermore, the number of vacancies continued to recover,
averaging 758,000 over the three months to May; the ONS's
experimental monthly vacancy statistics for April itself were "at
near pre-pandemic levels".
The ONS reported that the redundancy and hiring rates are back
to their pre-pandemic levels in most sectors.
A plunge in loan growth to businesses contrasts with strong
household mortgage lending, although monetary and credit data are
complicated by the COVID-19 shock and related policy responses. The
key points from the European Central Bank's (ECB) latest release of
monetary developments data, for May, are below (IHS Markit
Economist Ken
Wattret):
Looking at May's figures in more detail, the year-on-year (y/y)
rate of growth in eurozone M3 decelerated for the fourth straight
month, down to 8.4%, a 13-month low and a little over four
percentage points below its January 2021 peak.
The growth rate remains elevated and has been well above the
ECB's former reference value (of 4.5%) throughout the period since
the initial COVID-19 shock in March 2020.
The y/y rate of growth in M1 also continued to slow. Although
it remained in double digits for the 15th straight month, May's
11.6% rate was around five percentage points lower than its January
2021 high and the lowest rate for 14 months.
Switching to the counterparts to eurozone money growth, credit
to governments (up 15.4% y/y in May) remained the main driver of
overall credit growth (6.7% y/y), fueled by the huge expansion of
the ECB's asset purchases during the pandemic.
Growth in credit to the private sector was less elevated,
decelerating to 3.5% y/y in May.
By type of loan, May's figures showed a continuation of the
recent sharp deceleration in the growth rate for loans to NFCs.
May's y/y growth rate of 1.9% was the lowest for almost five years,
well down from the peak of 7.2% in August 2020.
By type of loan, a divergence of household lending trends is
also evident. The y/y rate of growth in loans for house purchases
has been picking up for some time and, at 5.4% in May, matched its
highest level since 2008.
Proposed EU approvals for products from two genetically
modified soybean lines and two GM maize lines should be withdrawn,
says the European Parliament's Environment Committee. It voted in
June in favor of objections to: Corteva Agriscience's
insect-resistant Conkesta (DAS81419) soybeans; a stack of Conkesta
with herbicide-tolerant Enlist E3 (DAS44406); and the company's
insect-resistant and herbicide-tolerant maize combining Herculex
(1507) with Syngenta's Viptera (MIR162) and Bayer legacy company
Monsanto's MON810 and NK603 traits. The fourth objection is to the
renewal of approval for Syngenta's insect-resistant Agrisure CB/LL
(Bt11) maize. EU member states recently failed to return qualified
majority votes either in favor or against the European Commission's
proposals to approve the soybean and maize lines. The proposals are
to be presented for a second vote at an appeal committee in July.
If that also returns a "no opinion", the Commission can go ahead
with the approvals, based on the positive safety assessments
concluded by the European Food Safety Authority (EFSA). (IHS Markit
Crop Science's Jackie Bird)
The Volkswagen (VW) Group has confirmed that it is interested
in acquiring a controlling stake in European car hire business,
Europcar, according to a Bloomberg report. The VW Group is looking
to acquire the company as part of its long-term mobility strategy.
In an emailed statement VW said that negotiations are at an early
stage and that no final decision has been taken. This statement
came after Bloomberg reported that VW had lodged a EUR2.2 billion
(USD2.6-billion) bid together with Attestor and Pon Holdings. The
VW statement said, "A potential transaction could generally be
attractive for VW. It represents one of several options to give VW
access to a platform that would support VW's long-term mobility
vision and strengthen VW's spectrum of products and services." (IHS
Markit AutoIntelligence's Tim Urquhart)
Vestas has secured a firm order to deliver 27 V174-9.5MW
turbines, along with a 15-year service agreement, for the 257MW
Arcadis Ost 1 offshore wind project in the German Baltic Sea. The
turbines will be installed without a jackup vessel. The wind farm,
located 19 kilometers off the coast of the Island of Rugen, suffers
from challenging seabed and soil conditions, thus requiring the use
of an innovative floating installation method for the wind
turbines. Instead of a jack-up vessel which requires contact with
the seabed, a floating dual-crane vessel operated by Heerema Marine
Contractors, will be used to perform dynamic lifts at sea. (IHS
Markit Upstream Costs and Technology's Monish Thakkar)
Volvo says that its next-generation electric vehicle (EV) will
have LiDAR technology and an "AI-driven super computer" as standard
equipment. The next EV is the successor to the Volvo XC90, due to
be revealed in 2022. Volvo says the equipment will help save lives
and set a new benchmark for automotive safety. Luminar also issued
a press release announcing that will provide its Iris LiDAR and
perception from its Sentinel solution. According to the Luminar
website, Iris is configured in a slim design for roofline
integration and is an auto-grade, low-cost solution developed for
scalability and flexibility; it is also capable of supporting
over-the-air updates. Volvo's subsidiary Zenseact and its
partnership with Luminar is part of the solution, as well as the
NVIDIA Orin system-on-a-chip solution. (IHS Markit
AutoIntelligence's Stephanie
Brinley)
In early June, Norway's Conservative-led minority government
published its Energy White Paper, a comprehensive report that
outlines long-term policy priorities in the energy sector,
including the oil and gas and low-carbon industries. The government
is not expected to introduce any major fiscal or regulatory changes
in the upstream sector as a result of the report, but it is likely
to make minor ad hoc adjustments that factor in Norway's climate
goals. The industry is also likely to face increased climate
scrutiny of hydrocarbon operations, increasing the regulatory
burden for offshore players. The recently published report
highlights the Norwegian oil and gas sector's stable policy and
regulatory environment, a key feature of the country's upstream
regime over the past eight years. The government reaffirmed its
commitment to offering prospective acreage on the Norwegian
continental shelf (NCS) as part of regular licensing rounds and
maintaining the existing fiscal and regulatory framework to
facilitate long-term offshore hydrocarbon production. The ruling
coalition is seeking to align ongoing exploration & production
(E&P) activity with its target of carbon neutrality by 2050 and
will continue to support the electrification of platforms through
direct funding and/or tax incentives, underscoring a collaborative
approach towards energy transition in the upstream industry. (IHS
Markit E&P Terms and Above-Ground Risk's Aliaksandr Chyzh)
Russian car-sharing firm Delimobil's founder Vincenzo Trani
said the company is considering expanding into markets in
developing countries and in selling local franchises. He also said
Delimobil was in talks with Qatar to open a franchise of its
Anytime Prime service, which provides long-term car rentals. Trani
added that Uzbekistan has also expressed interest in a traditional
car-sharing franchise. He stated that countries in Asia and North
Africa are interested in franchising, or in Delimobil establishing
its own local business. (IHS Markit Automotive Mobility's Surabhi
Rajpal)
Intel Corporation subsidiary Mobileye has announced the
advanced trials of its robotaxi (self-driving taxi) project, which
will use NIO's ES8 electric sport utility vehicles (SUVs) on the
roads of Tel Aviv (Israel), reports Trend News Agency. According to
the news source, the first consignment of NIO electric vehicles
(EVs) for the trials will reach Israel in a few days, with the
advanced trials beginning only in 2022. Mobileye is to install its
Level 4 autonomous driving kit in the NIO EVs in Israel. In the
preliminary trials, the autonomous vehicles will drive around
central Tel Aviv on a 15-kilometer route with no passengers and
only a test officer in the car. In the later stages of the trial,
the routes are to be expanded to include 33 km of roads. In the
pre-commercial stage, the routes are to be increased to include 111
km of roads. In the commercial stage of the trials, scheduled to
happen in 2023, passengers are to be transported to their
destinations. According to the report, Mobileye has been given a
temporary license by the Ministry of Transport to import the NIO
vehicles into Israel. (IHS Markit AutoIntelligence's Tarun
Thakur)
Namibia's real GDP fell by 9.3% quarter on quarter (q/q) and
6.5% year on year (y/y) during the first quarter of 2021. Most
sectors in the economy failed to grow from a year ago, with the
exception of the electricity and water sector (up 7.7% y/y), real
estate and business services (up 4.6% y/y) and public
administration, education and health services (up 1.7% y/y). (IHS
Markit Economist Thea
Fourie)
An increase in the water supply to farmers for irrigation
balanced less electricity consumption, particularly from the mining
sector, during the first quarter of the year. The positive
performance in the real estate and business services sector is
mainly attributed to a rebound in the real estate activity
following an increase in the stock of houses and the low interest
rate environment which prevailed over the period.
Subsectors in the economy which recorded the steepest decline
from a year ago included the construction sector (down 23.9% y/y),
manufacturing (down 22.3% y/y) and mining and quarrying (down 19.0%
y/y).
The poor performance in the construction sector could be mainly
attributed to reduced construction work by the central government.
"The contractionary performance in the [manufacturing] sector is
attributed mainly to the substantial declines in the subsectors of
basic metals, beverages and other food products that registered
massive reductions of 89.3 percent, 28.4 percent and 24.8 percent
during the first quarter of 2021," the Namibia Statistical Agency
(NSA) reported. Weak global demand, particularly for diamonds and
metal ores, left output levels in the mining and quarrying industry
lower by 19.0% y/y.
Asia-Pacific
APAC equity markets closed higher; Hong Kong +1.4%, Mainland
China +1.2%, Japan +0.7%, South Korea +0.5%, Australia +0.5%, and
India +0.4%.
Chinese ride-hailing giant Didi Chuxing (DiDi) has filed an
updated F-1 prospectus with the US Securities and Exchange
Commission (SEC), reports CNBC. The filing reveals that the company
plans to list 288 million American Depository Shares, which is the
equivalent of 72 million shares of Class A common stock, on the New
York Stock Exchange. The listing shares' price is expected to range
between USD13 and USD14 a piece, valuing DiDi at more than USD60
billion. At the upper end of the range, DiDi expects to raise a
little more than USD4 billion in its initial public offering (IPO).
(IHS Markit Automotive Mobility's Surabhi Rajpal)
Prices of pork and live pigs have fallen further in China over
the past week, raising concerns over the effectiveness of
government stabilization measures. Wholesale prices fell to CNY21
per kg in the third week of June - down by 50% since mid-February,
according to data from the Chinese Commerce Ministry. Figures from
the Agriculture Ministry shows the national live pig price falling
to CNY15.13 per kg, a decrease of 7% w/w and down 51% year-on-year.
Shocked by recent market developments, many farmers have responded
by selling off overweight pigs, further pressuring prices, and
raising concerns that the sell-off will setback China's herd
rebuilding efforts. (IHS Markit Food and Agricultural Commodities'
Max Green)
Triton, a US-based electric vehicle (EV) manufacturer, has
announced investment of INR21 billion (USD283 million) in the state
of Telangana (India) for setting up an EV manufacturing unit,
reports The Times of India. Triton has signed a memorandum of
understanding (MoU) with the Telangana government for establishing
a manufacturing unit for EVs at the National Investment and
Manufacturing Zone (NIMZ) in the town of Zaheerabad, wherein 150
acres of land (as sought by the company) for the establishment will
be provided through the Telangana State Industrial Infrastructure
Corporation (TSIIC). According to the source, the automaker will
manufacture 50,000 vehicles in the first five years, including
semi-trucks, sedans, luxury sport utility vehicles (SUVs) and
rickshaws, while creating 25,000 jobs. According to the source, the
state government will help Triton to get the required approvals and
applicable incentives. (IHS Markit AutoIntelligence's Tarun
Thakur)
US-based semiconductor manufacturer GlobalFoundries will build
a new fabrication plant in Singapore to meet the unprecedented
global demand for chips, reports Reuters. The new facility will be
built in collaboration with the Singapore Economic Development
Board and with co-investments from committed customers. According
to the company, more than USD4 billion will be invested in the
development. "Our new facility in Singapore will support
fast-growing end-markets in the automotive, 5G mobility and secure
device segments with long-term customer agreements already in
place," said GlobalFoundries CEO Tom Caulfield. (IHS Markit
AutoIntelligence's Jamal Amir)
Keppel O&M and Sembcorp Marine are in discussions for a
potential merger after Keppel Corporation (Keppel Corp) and
Sembcorp Marine inked a non-binding memorandum of understanding
(MOU). Upon completion of the merger, a combined entity will be
established between Sembcorp Marine and Keppel O&M. The entity
will be a listed entity with Sembcorp Marine's shareholders holding
shares in it, while Keppel Corp will receive shares and a cash
consideration of up to USD372 million (SGD500 million). As part of
the discussions, both companies will also work with workplace
unions on future labor force plans including workforce development
and training, and higher valuer-adding jobs creation. Under the
MOU, it is envisaged that Keppel Corp will enter into a 50-50
strategic partnership joint venture with the combined entity. Under
the strategic partnership JV, the combined entity will be the
preferred EPC partner for Keppel Corp's relevant projects, subject
to regulatory review. (IHS Markit Upstream Costs and Technology's
Jessica
Goh)
An investigation by the United States International Trade
Commission (USITC) has determined that imports of passenger
light-vehicle and light-truck tires from South Korea, Thailand, and
Thailand are to be subject to antidumping duties. The investigation
determined that tires from these countries are "sold in the United
States at less than fair market value", while imports from Vietnam
are subsidized by the government of Vietnam. However, the USITC
also determined that the imports from Vietnam were negligible and
terminated the investigation into Vietnam. (IHS Markit
AutoIntelligence's Stephanie
Brinley)
During the Bank of Thailand's (BoT) monetary policy meeting on
23 June, the bank held the one-day bond repo rate (the main policy
rate) steady at 0.5%. The rate has remained at a historically low
level since the 25-basis-point rate cut in May 2020. (IHS Markit
Economist Jola
Pasku)
The policy rate has been kept unchanged, despite an uptick in
inflation to 3.4% year on year (y/y) in April 2021, although still
within the 1-4% target band set by the BoT. Rising global commodity
prices and supply-chain disruptions have created upward
inflationary pressure on Thailand's consumer prices during the
second quarter. Even still, headline inflation is contained and has
averaged at 0.9% y/y in the first five months of the year. Core
inflation, which excludes volatile energy and raw food prices,
edged up slightly to 0.5% y/y in May, indicating subdued, albeit
accelerating, inflationary pressures.
The BoT commented in a statement published after the session
that the current inflationary pressures are temporary and driven by
the low base effect from 2020. Meanwhile, the committee expressed
concern that short-term growth will remain lackluster because of
the third wave of the coronavirus disease 2019 (COVID-19) pandemic.
Growth projections for 2021 and 2022 were trimmed to 1.8% and 3.9%,
respectively, down from 3.0% and 4.7% previously.
Posted 25 June 2021 by Chris Fenske, Head of Fixed Income Research, Americas, S&P Global Market Intelligence
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