Bias: Bearish-to-range-bound, as the EUR/THB is below the 90-day average and in the lower half of the 3-month range.
Key drivers:
• Rate gap: The European Central Bank is maintaining a cautious stance, whereas the Bank of Thailand recently cut interest rates to stimulate its economy.
• Risk/commodities: Oil prices are currently above their average, which could provide some support for the Baht given its energy-driven economy.
• Macro factor: Thailand's economic growth is projected to remain below potential, indicating persistent challenges that may limit the Baht's strength.
Range: Expect EUR/THB to trade within a stable range, with potential for slight upward movement but overall limited volatility.
What could change it:
• Upside risk: A significant improvement in Eurozone economic data could bolster the Euro.
• Downside risk: Continued weakness in Eurozone exports could lead to greater depreciation of the Euro against the baht.