EUR/THB Outlook:
Slightly positive, but likely to move sideways, as the rate is just above its recent average and lacks a clear current driver.
Key drivers:
• Rate gap: The European Central Bank has kept interest rates steady, while the Bank of Thailand has recently intervened to manage the baht’s strength.
• Risk/commodities: Oil prices are significantly above their average, which can support the euro given its impact on inflation and economic performance in the Eurozone.
• One macro factor: Eurozone inflation has recently fallen below the ECB’s target, raising concerns about future rate cuts and potentially affecting the euro's strength.
Range:
EUR/THB is likely to hold within its recent 3-month range, with limited movements expected unless new economic data emerges.
What could change it:
• Upside risk: A surprise increase in Eurozone economic data could bolster the euro.
• Downside risk: Renewed concerns over the eurozone’s economic stability could weaken the euro further.
