USD/THB Outlook:
The USD/THB is slightly positive but likely to move sideways, as the rate stands just below its 90-day average and is near the mid-range of the recent three-month prices. Recent US job data supports the dollar, but a forecasted drop in durable goods orders could counterbalance this strength.
Key drivers:
• Rate gap: The Federal Reserve's monetary policy continues to favor a stronger USD due to higher interest rates, contrasting with the Bank of Thailand's efforts to manage the rapidly appreciating THB.
• Risk/commodities: Oil prices are significantly above average, which generally supports the baht due to Thailand’s oil import dynamics.
• One macro factor: Concerns over the THB's strength impacting exports have prompted more control from the Bank of Thailand, potentially influencing the currency's stability.
Range:
Expect the USD to hold within its current range, with minor fluctuations around recent levels.
What could change it:
• Upside risk: A stronger-than-expected US economic performance could boost the USD further.
• Downside risk: A notable contraction in US durable goods orders may weaken the USD against the THB.
