The US

The Dollar index weakened 0.48% to 101.01. The Federal Open Market Committee (FOMC) latest minutes observed that inflation remained high, and the labour market is still tight. However, recent banking sector developments led many participants to lower their assessment of the rate target range. Some members considered holding interest rates steady in March, while others would have considered a 50 bps increase in the absence of recent banking developments.

US Equities & Sovereign Bonds

Wall Street closed higher where the Dow Jones was up by 1.14% to 34,030, S&P500 up by 1.33% to 4,146, and Nasdaq up by 1.99% to 12,166.

The UST10Y benchmark yield up by 5 bps to 3.445% and the UST2Y was also up by 1 bps to 3.968%, narrowing the inverted differential to 52 bps.

Eurozone

The Euro gained 0.49% to 1.105. Industrial production in the Euro Area increased by 1.5% m/m in February 2023, exceeding market expectations of 1.0% growth with a rebound in the production of energy, durable and non-durable consumer goods.

The UK

The British Pound also gained by 0.30% to 1.252. The UK economy stagnated in February 2023 after a 0.4% growth in January 2023. The services sector declined by 0.1%. Production output also fell by 0.2%, with electricity, gas, steam, and air conditioning supply being the main drag, while manufacturing remained stable.

Japan

The Japanese Yen gained by 0.41% to 132.58. Japan experienced a net population increase from immigration in 2022, but it was not enough to prevent a 12th consecutive year of decline in the overall working-age population. The number of people aged 15 - 64 fell by 0.4% to 74.21 million as of October 1, 2022. While this age group increased slightly as a share of the population, the trend towards a shortage of workers critical to Japan's economy remains.

China

The Yuan gained by 0.08% to 6.868. China's exports surged by 14.8% in March 2023, reaching an eight-month high of USD 315.59 billion, which is a significant rebound from the 6.8% drop in January-February. The increase in exports is the first since September 2022 and the strongest pace in eight months. Sales of steel and refined products increased, and exports to ASEAN, Russia, and the EU increased significantly, while those to the United States, Japan, and Taiwan fell.

South Korea

The Won gained 1.14% to 1,311. South Korea's import prices experienced a sharp decline of 6.9% y/y in March 2023, the steepest fall since December 2020. The drop was attributed to weaker oil prices and a stronger Won. Import prices for raw materials and intermediate goods fell significantly, while those for capital goods and consumer goods rose.

Australia

The Aussie dollar gained 1.36% to 0.678. Australia's unemployment rate remained unchanged at 3.5% in March 2023, below market expectations of 3.6%. Employment increased by 53k to 13.88 million, with full-time employment rising by 72k and part-time employment falling by 19,200. However, the underemployment rate increased from 5.8% to 6.2%.

Crude Oil

OPEC+ forecast that oil demand from China is set to increase by 760,000 barrels per day (bpd), higher than previous estimate of 710,000 bpd. This means that China’s oil demand is expected to average around 15.6 million this year. However, Brent closed lower earlier by 1.42% to US$86 per barrel and WTI down by 1.32% US$82 per barrel.

Gold

Gold Gained by 1.26% to US$2,040/oz, the Highest Level So Far This Year.

Malaysia Highlights

The Ringgit appreciated by 0.19% to 4.401. More than half of Malaysians surveyed expressed concern about job loss due to economic uncertainty, based on The Randstad Malaysia 2023 Workmonitor survey. The survey also found that job stability, income stability, retirement, and retrenchment are the most important factors influencing job seekers. While 80% of respondents are concerned about the economic uncertainty's impact on their livelihood, 86% expressed confidence in their employers to provide them with job security.

Ringgit Outlook for the Week

The support level for USD/MYR is seen at 4.380 and 4.390 while resistance is pinned at 4.420 and 4.430.

FBM KLCI

The FBM KLCI was down 0.04% to 1,434. Detailed transactions showed that the foreign investors were the net buyer with RM112.2 million. Local institutions and local retailers were net seller of RM48.7 million and RM63.5 million, respectively.

Fixed Income

MGS benchmark yield for 3-year down -2.0 bps to 3.335%, 5-year up -5.0 bps to 3.490%, 7-year -2.0 bps to 3.720%, and 10-year -3.5 bps to 3.840%.

Source: AmInvest Research - 14 Apr 2023