The recent forecasts for the Indian Rupee (INR) against the Thai Baht (THB) have highlighted a mixed outlook, influenced by various geopolitical and economic factors. Analysts note that the INR has weakened against the US dollar due to heightened concerns about rising energy prices pushing inflation upwards in India. As the world's third-largest oil consumer, India feels the pinch of surging crude oil prices, which can lead to increased costs domestically. This scenario is compounded by fears related to US President Donald Trump's tariff policies, which have escalated the sense of volatility for Asian currencies.
In the latest price data, INR to THB is trading at 90-day lows near 0.3758, which is 1.9% below its three-month average of 0.3832. The trading range for INR to THB has remained relatively stable, fluctuating between 0.3758 and 0.3966. Market sentiment appears weighed down as investors sell off Asian currencies, including the INR, amidst expectations of sustained US dollar strength fueled by anticipated economic stimulus measures from the US government.
The Thai Baht (THB) is also under pressure, having experienced a decline of about 2% recently against major currencies. This depreciation aligns with a broader trend affecting emerging Asian currencies, exacerbated by the imposition of a 36% reciprocal tariff on goods from Thailand as part of the escalating trade tensions driven by the Trump administration. Regional economic forecasts are peering into a bleak future, with potential impacts not only from tariffs but also from recent rate cuts by central banks seeking to foster growth.
Crude oil price movements, currently at 69.28 USD per barrel, have also influenced the THB. This price is 2.9% above its three-month average, but experiences high volatility, having traded within a significant 31.1% range. Given Thailand's oil dependency, this spike in oil prices can have ripple effects on its currency valuation, creating more uncertainty.
Overall, both the INR and THB are navigating through a challenging landscape, marked by geopolitical tensions, tariff implications, and rising oil prices, which leave both currencies vulnerable to further fluctuations in the immediate future. Investors should remain cautious and closely monitor these developments, as they will likely impact international transaction costs involving these currencies.