USD/THB Outlook: Slightly positive, but likely to move sideways, as the rate is just above its recent average, reflecting mixed influences on both currencies.
Key drivers:
- The US dollar is under pressure from expectations of future rate cuts by the Federal Reserve, indicating a weaker monetary stance compared to the Thai Baht's recent interest rate cuts aimed at stimulating the economy.
- Rising global gold prices and a strengthening Thai Baht have made the THB more attractive as it has appreciated due to capital inflows.
- While geopolitical tensions involving the US add uncertainty, the pressure appears balanced by Thailand’s solid current account surplus.
Range: Movement in USD/THB is likely to hold around current levels, drift within the established range, and possibly test recent extremes as external conditions evolve.
What could change it:
- Upside risk: A significant drop in US jobless claims or unexpected positive economic data could support the USD.
- Downside risk: Escalation in geopolitical tensions or a further decline in investor confidence could weaken the USD against the THB.
