SGD/THB Outlook:
The SGD/THB rate is likely to move sideways as it is near its recent average and within its 3-month range. The balanced influences from both currencies may keep the rate stable.
Key drivers:
• Rate gap: The Monetary Authority of Singapore is supporting the SGD amid economic challenges, while the Bank of Thailand faces issues with the THB's appreciation affecting exports.
• Risk/commodities: Crude oil prices are at 90-day highs, impacting Thailand’s economy as higher oil costs can affect overall trade dynamics.
• One macro factor: The strong performance of Thailand's economy raises concerns about export competitiveness, which might pressure the THB.
Range:
Expect movement to remain stable within the recent range, neither testing the extremes nor breaking new ground.
What could change it:
• Upside risk: A sudden rebound in Singapore’s economic growth could support the SGD.
• Downside risk: Increased intervention by the Bank of Thailand to control THB appreciation may strengthen the baht further.