Rates Spark: Trump Wants a Lower 10yr Yield Too!

Economic

Bond

Summary:

The latest Trump administration angle is for rates to be pushed lower through downward pressure on the 10yr yield, through lower inflation and a lower fiscal deficit. Achieve that and we'd agree. But achieve it first. Meanwhile, the Bank of England is likely to cut by 25bp, in line with market pricing. Going forward we see more GBP curve steepening.

The US 10yr yield finally breaks below 4.5%, with a little nudge from Treasury Secretary Bessent

The US 10yr finally broke below 4.5%. It did feel like it was coming. Mutual funds data has consistently shown buying of duration pressure since the turn of the year, and the inflation data in the guise of CPI, PPI and PCE have just about played ball over consecutive weeks, at least in the guise of tamer month-on-month rates. This also comes after a material rise in the 10yr yield since the Fed started its rate-cutting cycle, with the higher 10yr yield practically in sync with the downsizing of rate cut expectations. Back in September the funds strip was discounting a landing rate at 3%. Now its closer to 4% (or just under). And its been stabilising in that area.

Wednesday also saw the release of Scott Bessent's re-funding plans, which were bang in line with Janet Yellen’s – so a status quo there, downsizing some fears for more long-dated issuance. Treasury Secretary Bessent went on to comment that the Trump administration is minded to inject downward pressure on the 10yr Treasury yield, and it was here rather then through the funds rate that the administration could achieve lower rates. Some weakish ISM survey evidence conveniently helped that trade on the day. But beyond that it is hard to see where the big driver is for a lower 10yr yield from the Trump administration, apart from perhaps some huge successes from DOGE.

We've been tactically bullish Treasuries in the past couple of weeks, so all of this is moving in our (short-term) direction. However, we also assert there is not huge room to the downside for the 10yr yield. An effective floor is in place at just under 4% as determinable from the funds rate strip. That floor can of course shift lower, but would need a better reason than an approaching 10yr rate. And the 10yr Treasury yield sits some 50bp over this. So enjoy the move lower while it lasts. Another 10-20bp and it will begin to look like its gone too far, and that’s where the backup starts.

Bank of England likely to cut and we see more to come

We think the Bank of England will cut by another 25bp, bringing the Bank Rate down to 4.5%. Markets are already fully pricing in this week’s cut but going forward markets seem less certain. The currently priced in terminal rate of 3.75% looks high and should be closer to 3.25% in our view. A repricing lower may take some time, however, since market concerns about inflation continue to linger. We see the numbers moving in the right direction and thus see room for the front end to move lower later this year.

We’ll be watching the vote split for any surprises. In our view an 8-1 vote is the most likely outcome, whereby the arch-hawk Catherine Mann would be in favour of holding the current rate. If she decides to support a cut, then that would be a strong dovish signal. Should, on the other hand, we have fewer votes in favour of a cut, and government spending is flagged as a dominant force in the growth picture, then we would expect a more hawkish reaction from markets.

Longer-dated gilts remain very much driven by US dynamics and the 10Y yield of 4.4% actually trades at exactly the same level as 10Y US Treasuries. In the meantime, concerns about the fiscal situation keep upward pressure on the back end of the curve too. And QT doesn’t help with the supply pressures. So with the long end of the curve anchored at elevated levels, we think the next move for sterling rates would be one of bull steepening.

Too much focus on the ECB's neutral rate?

European Central Bank expectations are testing lower again given the dovish signals from the wage data. Rather than taking it at face value, the data should be interpreted as corroborating the ECB’s inflation picture. But the c.3% wage growth for end-2025 fits neatly in Chief economist Lane’s notion that it aligns with the ECB’s 2% target accounting for 1% productivity growth in the medium term.

With more indicators giving the ECB room for further cuts – and markets room to price them – that puts the neutral rate at the centre of discussions of how far the ECB can go. But it appears that the ECB is uncomfortable with the attention the neutral rate is getting, especially after Lagarde deflected questions on the topic by pointing to an upcoming staff paper to be published on Friday. On Wednesday Vice President de Guindos pointed out that using the neutral rate as a reference to determine the monetary policy stance was “not the right approach” and “not very useful”. The ECB always needs to take in all data to assess the appropriate policy stance, and indicators such as the bank lending survey “provide a much better indicator of the restrictiveness”.

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Warren Takunda

Stocks

Asian shares were trading mostly higher Thursday, after a Wall Street rally that followed profit reports from major companies.

Japan’s benchmark Nikkei 225 gained nearly 0.5% in afternoon trading to 39,020.16. Australia’s S&P/ASX 200 surged 1.2% to 8,520.70. South Korea’s Kospi edged up 0.7% to 2,526.87. Hong Kong’s Hang Seng rose 0.8% to 20,753.87, while the Shanghai Composite added 1.0% to 3,260.49.

In Japan, Honda Motor Co. stock, which jumped the previous day after Japanese media reported its talks to set up a joint holding company with Japanese rival Nissan Motor Corp. will unravel, pared some of those gains. Nissan shares, meanwhile, recovered to trade higher. The media reports continued Thursday, but there was no immediate confirmation from either company.

On Wall Street, the S&P 500 rose 0.4%, while the Dow Jones Industrial Average added 317 points, or 0.7%, and the Nasdaq composite gained 0.2%.

Toymaker Mattel jumped 15.3% after blowing past analysts’ forecasts for profit in the latest quarter. Strength for its Hot Wheels brand helped make up for some softness for Barbie and other dolls. Mattel also gave a forecast for profit this upcoming year that topped analysts’ expectations.

Amgen rallied 6.5% and was one of the strongest forces pushing upward on the S&P 500. It reported stronger profit for the latest quarter than expected, thanks in part to growth for its Repatha medicine, which can lower bad cholesterol and reduce the risk of heart attack.

They helped offset a 7.3% drop for Alphabet, which sank even though Google’s parent company reported stronger profit for the latest quarter than analysts expected. Investors focused instead on slowing growth for its cloud business, whose revenue fell short of forecasts. They also homed in on the $75 billion Alphabet is budgeting for investments this year, roughly $15 billion more than analysts expected, as it remains in the rush to develop artificial-intelligence technology.

Advanced Micro Devices fell 6.3% even though the chip company beat profit expectations for the latest quarter. While analysts called AMD’s results solid, they also asked why CEO Lisa Su did not give more details about expectations for the performance of its AI offerings specifically.

Uncertainty is also hanging over the global economy because of President Donald Trump’s tariffs. After rocking financial markets around the world at the start of this week, worries about a potentially punishing global trade war have eased a bit after Trump gave 30-day reprieves for tariffs on both Mexico and Canada. That bolstered traders’ hopes that Trump sees tariffs as merely a tool for negotiation, rather than as a long-term policy.

In the meantime, Trump has pressed ahead with tariffs on Chinese goods, and Mericle expects tariffs to hit autos from the European Union, among other potential moves. That could drive a one-time boost to inflation, which could leave a widely followed measure of underlying inflation trends at 2.6% in December, above the Federal Reserve’s target of 2%.

One of the fears hurting Wall Street is that the upward pressure on inflation could keep the Fed from cutting interest rates this year, after it began doing so in September in order to relax pressure on the economy and give the job market some help.

Yields in the bond market fell Wednesday after a report said growth for mining, finance and other U.S. services businesses was weaker last month than economists expected. The survey by the Institute for Supply Management found many businesses citing poor weather conditions.

The yield on the 10-year Treasury yield fell to 4.42% from 4.52% late Tuesday.

All told, the S&P 500 rose 23.60 points to 6,061.48. The Dow Jones Industrial Average gained 317.24 to 44,873.28, and the Nasdaq composite added 38.31 to 19,692.33.

In energy trading, benchmark U.S crude added 25 cents to $71.28 a barrel. Brent crude, the international standard, rose 20 cents to $74.81 a barrel.

In currency trading, the U.S. dollar inched down to 152.42 Japanese yen from 152.55 yen. The euro cost $1.0391, down from $1.0407.

Source: AP

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FastBull Featured

Daily News

[Quick Facts]

1.Amid Trump's tariff shadow, the UK and Canada seek to improve trade relations.

2.The French National Assembly votes down a no-confidence motion against the government.

3.US set to reveal Ukraine peace plan next week, possibly proposing freeze of current front lines.

4.Goolsbee warns: tariffs could threaten inflation

5.Barkin indicates a continued rate cut tendency this year

6.Lane forecasts a longer time needed for inflation to hit 2%.

[News Details]

Amid Trump's tariff shadow, the UK and Canada seek to improve trade relations

Leaders of the UK and Canada held a phone call on Wednesday to discuss improving trade relations, though they did not publicly commit to restarting the bilateral free trade negotiations that were put on hold last year. Negotiations for the Canada-UK Free Trade Agreement were suspended in January 2024, mainly due to agricultural disputes. According to a statement released by the UK Prime Minister's Office, during Wednesday's conversation, Prime Minister Starmer " welcomed an international conversation on the importance of trade and collaboration."

The French National Assembly votes down a no-confidence motion against government

On the afternoon of February 5th, local time, the French National Assembly held a vote on two motions of no confidence against the current government proposed by the far-left party La France Insoumise. Neither motion passed. On February 3rd, French Prime Minister Bérut announced in the National Assembly that the government, using the authorization of relevant constitutional articles, forced through the draft of the 2025 national budget and the first part of the social security budget draft without a vote in the National Assembly. Immediately afterwards, the far-left party La France Insoumise in the National Assembly proposed a motion of no confidence against the government.

US set to reveal Ukraine peace plan next week, possibly proposing freeze of current front lines

According to reliable sources, US allies expect the Trump administration to unveil the long-awaited plan to end the Russia-Ukraine conflict at the Munich Security Conference in Germany next week. Keith Kellogg, Trump's special envoy for Russia-Ukraine affairs, will present this blueprint to allies. They declined to disclose the level of detail and format of the discussions. The proposal will be put forward at the conference to be held in Bavaria from February 14th to 16th, just as the Russia-Ukraine conflict is about to enter its third year. Kellogg and others have hinted in recent weeks at what Trump's allies call "peace through strength." The content may include freezing the conflict, leaving the territories occupied by Russian troops undecided, while providing security guarantees to Ukraine to ensure that Moscow cannot launch another attack.

Goolsbee warns: tariffs could threaten inflation

Chicago Fed President Goolsbee said in a speech on Wednesday that continuously imposing large-scale tariffs may disrupt the supply chain and have a substantial impact on overall inflation.

Currently, the White House is threatening to impose tariffs of up to 60% on Chinese imports, 25% on imports from Mexico and Canada, and at least 10% on imports from other countries around the world. If these tariff policies are implemented and other countries take retaliatory measures, the downward trend of US inflation since 2022 may be reversed.

The trade conflicts during Trump's first term mainly affected some Chinese goods and did not lead to a significant increase in overall economic inflation. The soaring inflation after the COVID-19 pandemic was due to the change in the global working model and large-scale fiscal stimulus, which restricted the labor supply and led to a surge in consumer demand, ultimately causing inflation to get out of control. The currently threatened comprehensive and high tariffs may be more similar to the early days of the COVID-19 pandemic rather than the trade conflicts in 2018.

We must consider any factor that may push up prices. If we find in 2025 that inflation rebounds or the decline stalls, the Fed will face a difficult choice and must figure out whether inflation is due to an overheating economy or caused by tariffs. This distinction will determine whether and when the Fed takes action.

Barkin indicates a continued rate cut tendency this year

Richmond Fed President Barkin explained on Wednesday that the current interest rate policy is still restrictive and should therefore support further cut from the current level slightly above 2.5% to the Fed's 2% target. However, it is necessary to wait and see for a while before making a decision.

It is expected that inflation will decline further this year and the economy will continue to grow. The Fed still tends to further cut interest rates this year, but it needs to better understand the impacts brought about by the Trump administration's new measures in areas such as tariffs, immigration, and regulation.

No options will be ruled out, but the current economic situation does not support raising interest rates. Because raising interest rates requires signs of an overheating economy, and I haven't seen any signs of it.

Lane forecasts a longer time needed for inflation to hit 2%

Philip Lane, Chief Economist of the ECB, delivered a speech on Wednesday. He said, given that inflation risks remain two-way, flexibility should be maintained when formulating monetary policy. Although officials are optimistic that the increase in consumer prices will reach 2% this year, it may take longer than expected to reach this level.

If acting too cautiously, the inflation situation below the target level may prevail. A sound monetary policy approach should be able to balance the risks of acting too slowly and acting too quickly. Balancing these considerations suggests that a middle path is appropriate, that is, neither overweighing the upside risks nor overthinking the downside risks.

Based on the latest economic data and statements by policymakers, the market widely expects another interest rate cut in March. But the path after that is becoming increasingly controversial.

[Today's Focus]

UTC+8 14:25 Unemployment rate in Switzerland in January

UTC+8 20:00 Bank of England's interest rate decision in February

UTC+8 03:30 Speech by Fed Governor Waller

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Adam

Economic

The Electronics Sector: A Costly Disruption

China remains the dominant supplier of consumer electronics to the U.S. In 2023, the country exported $66.7 billion worth of mobile phones and home electronics, $37.4 billion in computers, and $15.7 billion in computer accessories to the American market.

According to a January 2025 report from the Consumer Technology Association (CTA), the new tariffs could result in dramatic price hikes, with laptops becoming 68% more expensive, gaming consoles increasing by 58%, and smartphones seeing a 37% rise in retail prices. With 87% of gaming consoles, 78% of smartphones, and 79% of laptops and tablets imported from China, the tariff-induced price surge will directly affect millions of American consumers.

Retailers and manufacturers have limited short-term alternatives. Relocating production to other countries is neither quick nor cost-effective, meaning most companies will pass the increased costs onto consumers. As a result, household spending on essential electronic devices could rise sharply in the coming months.

Apparel and Textile Prices Under Pressure

China is also a major exporter of textiles and apparel, with $19.6 billion worth of clothing and fabrics shipped to the U.S. in 2023. The National Retail Federation (NRF) has warned that higher tariffs will directly increase prices on clothing, footwear, and travel accessories, such as backpacks and handbags.

Adding to the burden, the Trump administration’s removal of the "de minimis" exemption for Chinese imports will have an immediate effect. Previously, small shipments valued under $800 were exempt from tariffs, benefiting online retailers like Temu and Shein that specialize in direct-to-consumer, low-cost shipments. Without this exemption, these platforms may struggle to maintain their competitive pricing, forcing consumers to pay more for fast fashion and affordable retail goods.

Several companies have already signaled their intent to raise prices in response to the tariffs. Columbia Sportswear CEO Tim Boyle stated that the company is preparing to increase retail prices, while ELF Beauty CEO Tarang Amin told CNBC that price adjustments will be necessary if tariffs remain in place.

Auto Parts: Higher Costs, Higher Car Prices

The automotive industry is another sector heavily dependent on Chinese imports, with $14.6 billion in auto parts shipped from China to the U.S. in 2023. The new tariffs will significantly impact car manufacturers, as many U.S. automakers rely on Chinese components for vehicle production.

Mary Lovely, a senior fellow at the Peterson Institute for International Economics, has warned that higher tariffs on Chinese auto parts could force U.S. car manufacturers to raise vehicle prices. Since shifting production away from China is both costly and time-consuming, manufacturers have few immediate alternatives to mitigate the impact. Lovely further emphasized that if Trump extends tariffs globally, automakers will struggle to find a viable alternative manufacturing base, leaving U.S. consumers with higher vehicle prices and potential delays in production.

Household Appliances: A Growing Expense for Families

The home appliance industry is another sector expected to feel the effects of rising import costs. In 2023, the U.S. imported $13.8 billion worth of household appliances from China, including refrigerators, washing machines, and kitchen equipment.

The NRF has projected that the new tariffs could push the price of a standard refrigerator from $650 to $776, illustrating how even essential home goods will become significantly more expensive. With inflation already affecting consumer spending, any additional increases in home appliance costs could strain household budgets even further.

Economic and Retail Sector Concerns

The NRF and other industry groups have urged the U.S. government to pursue diplomatic negotiations rather than relying on punitive tariffs, arguing that increased costs will disproportionately affect working-class Americans and small businesses. In a February 1 statement, the NRF emphasized that tariffs function as a tax on American consumers, warning that higher retail prices will weaken purchasing power and slow down overall economic growth.

Retailers, manufacturers, and economists have all highlighted the long-term risks of continued tariff escalation. If the 10% tariff is raised further or extended across additional product categories, inflationary pressures could intensify, potentially pushing the U.S. economy toward weaker consumer demand and slower growth.

A Looming Cost Crisis for Consumers

The decision to increase tariffs on Chinese imports is set to trigger widespread price hikes across multiple industries, impacting everything from electronics and clothing to cars and household appliances. With no immediate production alternatives available for many retailers and manufacturers, the cost burden is likely to fall directly on U.S. consumers.

If tariffs remain in place or increase further, American households will face steep price surges on everyday goods, making inflation even harder to contain. Retailers and industry leaders are urging policymakers to pursue trade negotiations rather than prolonged tariff battles, warning that if tensions escalate, the economic impact could be severe, further straining the purchasing power of millions of Americans.

Source: Business Insider

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Adam

Economic

Wage Increases Failing to Offset Inflation

The Ministry of Health, Labour, and Welfare released its 2024 labor market report, revealing a paradoxical trend: while wages have increased, workers’ actual purchasing power continues to erode. The 2.9% nominal wage increase was driven by corporate efforts to retain talent and support consumer spending, yet inflationary pressures outpaced these gains, resulting in a net reduction in real income.

For three consecutive years, Japan’s real wages have fallen, undermining the benefits of salary hikes. This disconnect highlights a structural imbalance in Japan’s economy, where price increases in essential goods and services negate wage growth, leading to diminished living standards despite higher earnings.

The Inflationary Cycle and Consumer Hardship

The sustained 3.2% inflation rate in Japan has significantly impacted household finances. Rising costs of staple goods, utilities, and everyday necessities continue to strain consumers. A key example is the soaring price of rice, leading supermarkets to ration sales, limiting purchases to 2kg or 5kg per customer. This underscores the broader issue of supply constraints and escalating costs, particularly for food and energy.

Hideyuki Araki, a senior economist at Risona Institute, warns that Japan is caught in a dangerous cycle where rising wages lead to higher costs, which in turn fuel further inflation. While salary increases are often viewed as a sign of economic strength, in this case, they risk exacerbating inflationary trends, further reducing consumer purchasing power.

The Social and Economic Impact of Prolonged Real Income Decline

Experts predict that Japan’s cost-of-living crisis will persist in the medium term, creating pressure on social security, government policy, and economic growth. With Japan ranked as the fourth-largest economy globally, its continued struggle to balance wages and inflation presents a significant challenge.

Persistent declines in real income may reduce consumer confidence, leading to lower discretionary spending and weaker domestic demand, further slowing economic expansion. If inflation remains unchecked, the long-term repercussions could include heightened financial stress for middle- and lower-income households, increased reliance on government support, and a potential slowdown in corporate investment and job creation.

Addressing the Crisis: The Need for a Balanced Economic Approach

To break this inflationary loop, Japan must pursue coordinated fiscal and monetary policies aimed at stabilizing consumer prices while maintaining wage growth. Possible solutions include:

Targeted subsidies for essential goods to reduce the impact of food and energy price surges.

Strengthening supply chain resilience to mitigate cost pressures on imported goods.

Encouraging productivity-driven wage increases , ensuring that salary growth is not merely reactionary but supported by economic expansion.

Enhancing government intervention in price control mechanisms, particularly for essential commodities.

Japan’s current economic paradox reflects deeper structural challenges that require urgent and strategic policy responses. Without addressing the imbalance between inflation and wage growth, the risk of long-term economic stagnation and declining consumer welfare will continue to loom over the world’s third-largest economy by GDP.

Source: Reuters

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Alex

Economic

Energy

The Trump administration is looking into ways to cancel federal loans granted by the Department of Energy for transition projects from a $400-billion fund, Bloomberg has reported, citing an unnamed source.

According to the report, the new leadership at the Department of Energy would focus its financial firepower on projects in nuclear energy, liquefied gas and other segments supported by the White House, as announced by the new director of the department’s loan office, John Sneed.

Bloomberg also reported that the Department of Energy had said in an email statement that loans granted by the previous administration were under review currently “to ensure all activities are consistent with President Trump’s executive orders and priorities.” According to Bloomberg’s source, it is uncertain whether there is a legal path to canceling the previously granted loans.

The news about the change in priorities at the Department of Energy’s Loan Programs Office comes less than two months after the news emerged that the office was in a rush to hand out billions ahead of Trump’s taking office in anticipation of just such a change in priorities.

The Financial Times reported in December that the loans office had handed out over $38 billion in loans since the November elections. For context, the total commitments since the passing of the Inflation Reduction Act had amounted to $54 billion in loans and loan guarantees.

By far the biggest DoE loan commitment was the $15 billion that the Loan Programs Office granted to Pacific Gas and Electric to upgrade its infrastructure. This is the largest LPO loan ever granted.

Among the other large commitments by the LPO the FT listed in its December was a $7.54-billion loan to Samsung and Stellantis for a battery plant in Indiana, a $6.57-billion loan to electric car maker Rivian, which is also backed by Amazon, and a $4.9-billion commitment to transition tech major Invenergy for the construction of a transmission line.

Source: OILPRICE

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Adam

Economic

Thailand’s Export Outlook and the Need for Strategic Response

Despite Thailand’s exports growing by 5.4% in 2024, reaching $300.5 billion, the uncertain global trade environment poses major challenges for 2025. In Q1 2025, exports are expected to increase by 2-3% to $72.5 billion, averaging $24-25 billion per month. However, trade disruptions stemming from U.S. policy shifts could weigh heavily on Q2 and beyond, requiring proactive measures from both the government and private sector.

According to Chaichan Charoensuk, Chairman of TNSC, Thailand must closely monitor U.S. policy developments and strengthen public-private cooperation. He proposed accelerating joint advisory committee meetings on trade issues, convening them monthly or quarterly, rather than waiting for periodic assessments.

To centralize policy coordination, he also suggested establishing a "Trump 2.0 Policy War Room" immediately upon the return of Commerce Minister Phichai Naripthaphan from the U.S.. This initiative aims to ensure a unified trade strategy, protect Thai exports, and reinforce Thailand’s position in global trade negotiations.

Key Risks for Thai Exports

The escalating U.S.-China trade war remains the most pressing concern for Thai exporters, as it could lead to greater protectionism and market instability. Specific Thai exports at risk of higher U.S. tariffs include:

Electronic goods and electrical appliances

Rubber-based products

Auto parts and machinery

If tariffs increase, Thai manufacturers could face reduced competitiveness and declining export revenues, making it imperative to diversify trade routes and reduce dependency on the U.S. market.

TNSC’s Response Plan: Supply Chain Diversification and Trade Expansion

To mitigate the immediate risks, the TNSC has proposed a multi-pronged strategy, focusing on:

Maintaining neutrality in the trade war to avoid political and economic repercussions.

Strengthening supply chain resilience by optimizing logistics and cost efficiency.

Boosting innovation and cost-competitiveness in manufacturing.

Expanding into alternative markets such as

India and the Middle East to lessen reliance on U.S.-China trade.

Maximizing Free Trade Agreements (FTAs) to secure preferential trade terms.

Thai Chamber of Commerce’s Economic Projections and Policy Recommendations

Sanan Angubolkul, Chairman of the Thai Chamber of Commerce, outlined a three-phase economic outlook for Thailand, detailing how the country should navigate trade uncertainties.

In the short term, the market is experiencing shock and volatility, driven by investor concerns over U.S. policy unpredictability. The Thai baht has weakened, reflecting capital outflows and investor anxiety. Despite this, export growth is expected to continue in early 2025.

In the medium term, trade and investment patterns will adjust to new tariff realities. China may intensify efforts to expand exports to ASEAN, potentially flooding regional markets with cheaper Chinese goods, increasing competition for Thai manufacturers. To counter this, the Thai government must implement protective measures, ensuring fair market conditions and stabilizing domestic industries.

In the long term, geopolitical trade tensions could accelerate supply chain localization, limiting opportunities for export-dependent economies like Thailand. To minimize risks, Thailand must diversify its export markets, focusing on FTA-driven expansion and global trade partnerships.

Three Key Policy Initiatives to Strengthen Thailand’s Trade Resilience

To prepare for economic instability, the Thai Chamber of Commerce has proposed three key initiatives:

Formation of "Thailand+ Task Force"A joint public-private sector task force would analyze U.S. trade policies and develop a national trade strategy. This initiative would also strengthen ties with the U.S. Chamber of Commerce, fostering greater collaboration on trade negotiations.

Attracting Foreign Investment Amid Global UncertaintyThailand could capitalize on global supply chain shifts by offering competitive investment incentives to attract multinational companies relocating production. This strategy aims to position Thailand as a manufacturing hub for companies seeking alternatives to China.

Accelerating FTA NegotiationsThailand must fast-track key trade agreements, prioritizing the Thailand-EU FTA to expand its export market. Strengthening ties with regions such as the Middle East, Africa, and Europe would reduce reliance on China and the U.S., providing a more balanced trade portfolio.

Proactive Adaptation to Global Trade Shifts

As the impact of Trump’s tariff policies becomes clearer in 2025, Thailand’s government and business sectors must act swiftly to mitigate risks. By strengthening supply chains, diversifying export markets, and advancing trade negotiations, Thailand can safeguard its economic stability and maintain its competitive position in the global market.

While Thailand is not yet a primary target of U.S. trade measures, it remains vulnerable to global supply chain disruptions and shifting trade alliances. The country’s ability to adapt to geopolitical uncertainties will determine its long-term economic resilience in an increasingly unpredictable trade landscape.

Source: Thai Nation

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Rates Spark: Trump Wants a Lower 10yr Yield Too!

The US 10yr yield finally breaks below 4.5%, with a little nudge from Treasury Secretary Bessent

Bank of England likely to cut and we see more to come

Too much focus on the ECB's neutral rate?

Stock Market Today: Asian Shares Rise Following Wall Street Rally on Healthy Earnings

February 6th Financial News

[Quick Facts]

[News Details]

[Today's Focus]

U.S. Consumers Face Steep Price Hikes on Chinese Imports

The Electronics Sector: A Costly Disruption

Apparel and Textile Prices Under Pressure

Auto Parts: Higher Costs, Higher Car Prices

Household Appliances: A Growing Expense for Families

Economic and Retail Sector Concerns

A Looming Cost Crisis for Consumers

Source: Business Insider

The Paradox in Japan: Rising Wages but Declining Real Income

The Inflationary Cycle and Consumer Hardship

The Social and Economic Impact of Prolonged Real Income Decline

Addressing the Crisis: The Need for a Balanced Economic Approach

Targeted subsidies for essential goods to reduce the impact of food and energy price surges.

Strengthening supply chain resilience to mitigate cost pressures on imported goods.

Encouraging productivity-driven wage increases , ensuring that salary growth is not merely reactionary but supported by economic expansion.

Enhancing government intervention in price control mechanisms, particularly for essential commodities.

Source: Reuters

Trump Is Looking for Ways to Cancel $400 Billion in Clean Energy Loans

Source: OILPRICE

Thai Investors Propose Strategies to Counter Trump's Tariff Policies

Key Risks for Thai Exports

Electronic goods and electrical appliances

Rubber-based products

Auto parts and machinery

TNSC’s Response Plan: Supply Chain Diversification and Trade Expansion

Maintaining neutrality in the trade war to avoid political and economic repercussions.

Strengthening supply chain resilience by optimizing logistics and cost efficiency.

Boosting innovation and cost-competitiveness in manufacturing.

Expanding into alternative markets such as

India and the Middle East to lessen reliance on U.S.-China trade.

Maximizing Free Trade Agreements (FTAs) to secure preferential trade terms.

Thai Chamber of Commerce’s Economic Projections and Policy Recommendations

Three Key Policy Initiatives to Strengthen Thailand’s Trade Resilience

Proactive Adaptation to Global Trade Shifts

Source: Thai Nation

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