The USD to THB exchange rate is currently bearish, with USD trading at 31.19, below its 3-month average and near recent lows. Three main factors are influencing this trend. First, the Federal Reserve's anticipated rate cuts could weaken the USD, especially as three cuts are expected through mid-2026. Second, improving global growth and rising commodity prices may support the THB as capital inflows are expected. Lastly, Thailand’s strong current account surplus and planned reforms could bolster the baht.
In the near term, the USD/THB rate is expected to fluctuate within a range slightly below recent trading averages. Upside risks include unexpected increases in US economic data signaling resilience, while downside risks could arise from further ASEAN efforts to reduce USD reliance, affecting cross-border transactions. The evolving oil prices, currently volatile and nearing highs, may also indirectly impact the baht's strength, which is sensitive to imported oil costs.