Bangkok: The Thai baht strengthened to 32.49 baht per dollar, a notable appreciation driven by a weakening US dollar and easing concerns over potential conflict in the Middle East. Market analysts are closely monitoring Thai exports in February, emphasizing risk management strategies.
According to Thai News Agency, Mr. Poon Panichpibul, a money and capital market strategist at Krung Thai Bank, reported that the baht opened at 32.49 baht per dollar, a significant improvement from the previous closing rate of 32.82 baht per dollar. The primary factor behind this shift is the weakening of the US dollar, with the DXY index dropping to 99.2 points as concerns about the Middle East situation dissipated, causing a gradual decline in oil prices. Additionally, the dollar faces pressure from the strengthening euro and British pound, as markets anticipate possible monetary tightening by the European Central Bank and the Bank of England if inflation remains high due to geopolitical risks. Despite these developments, the baht remains susceptible to volatility because of ongoing geopolitical uncertainties. The focus is also on the domestic front, where export and import figures for February, particularly in the electronics and semiconductor sectors, are expected to show continued growth. The estimated t rading range for the baht today is 32.40-32.75 baht per dollar.
Meanwhile, SCB Financial Markets projects fluctuations in the Thai baht within the 32.40-32.70 baht per dollar range. The baht's strength is attributed to the market's reduced concerns over a global energy price war, stemming from recent signals by US and Israeli leaders to avoid attacks on energy infrastructure. Additionally, the Bank of Japan has held its policy interest rate steady at 0.75%, with indications of a potential rate hike if inflation rises. The European Central Bank has maintained its interest rate at 2% and stands ready to implement further measures should inflation accelerate. These global monetary policies contribute to ongoing currency volatility, which continues to exert downward pressure on the baht, leading to short-term fluctuations.