AUD/THB Outlook:
The AUD/THB is currently slightly positive and likely to move sideways as it trades above its recent average and is situated within the mid-range of the last three months. This positioning is supported by ongoing strength in the Australian dollar.
Key drivers:
• Rate gap: The Reserve Bank of Australia's cautious approach contrasts with the Bank of Thailand’s interventions to manage the baht's strength, impacting capital flows toward the AUD.
• Risk/commodities: Rising oil prices are boosting broader economic sentiment, which tends to support the AUD, a commodity-linked currency.
• Macro factor: Continued expansion in China's manufacturing sector is enhancing demand for Australian exports, thereby benefiting the AUD.
Range:
AUD/THB is expected to drift within its recent range, consolidating gains while remaining influenced by external factors.
What could change it:
• Upside risk: A shift towards more aggressive interest rate hikes by the RBA could propel the AUD higher.
• Downside risk: Any significant drop in global commodity prices could weaken the AUD against the THB.