Tue, August 16, 2022

business

Baht could weaken to 36.05 today: market strategist


The baht opened at 35.94 to the US dollar on Wednesday, the highest in five years, weakening from Tuesday’s close of 35.80.

The currency is expected to move between 35.85 and 36.05 during the day, predicted Krungthai Bank market strategist Poon Panichpibool.

He said the baht weakened quickly, closing in on the 36 level mainly due to the dollar’s strengthening from a demand in safe assets.

Additionally, several European currencies are weakening due to recession concerns, which could support the dollar to strengthen and the baht to weaken.

Poon said the dollar might “invert” if the US Federal Reserve does not signal it would go in for a heavy rate increase in July.

The baht has a chance to weaken past 36 to the dollar if the Chinese government enforces lockdown measures again and the number of Covid-19 patients in Thailand also increases.
The baht came under pressure as foreign investors offloaded Thai stocks, especially stocks relating to tourism and reopening, Poon noted.

However, the Bank of Thailand might intervene, which would slow down the weakening of the baht, so investors will be able to close risks in time, he said.

Exporters might sell the dollar once the baht reaches 36 to the US currency, which would also slow the baht’s weakening, while importers have already purchased a good amount of dollars so they might not panic buy this currency and wait for the baht to go below 36, Poon added.

Published : July 06, 2022

By : THE NATION