The market bias for the INR to THB exchange rate is currently range-bound.
Key drivers include the interest rate differential, as the Bank of Thailand is maintaining a cautious approach amidst economic challenges, while the Reserve Bank of India may face pressure due to foreign outflows. In addition, a projected weak performance for the Indian economy is influencing sentiment. Meanwhile, Thailand's current account surplus supports the baht's strength.
In the near term, the INR to THB exchange rate is expected to trade within a narrow band, reflecting recent volatility.
An upside risk could emerge from improved trade relationships between the US and India, which may boost the INR. Conversely, persistent outflows from Indian markets and rising global oil prices could weigh on the rupee, leading to downward pressure on the exchange rate.