USD/THB Outlook: Slightly weaker, but likely to move sideways as the rate is below its recent average and near recent lows due to ongoing uncertainties in the US economy.
Key drivers:
• Rate gap: The Federal Reserve is expected to cut rates, while the Bank of Thailand has recently lowered its rate, creating a challenging environment for the USD against the THB.
• Commodities: Oil prices are currently at multi-month highs, which typically supports the Thai Baht due to its influence on Thailand's energy costs and trade balance.
• Economic growth: Thailand's economy is projected to grow below potential, which could limit the THB's strength against the USD in the near term.
Range: USD/THB is likely to remain within its recent range as both currencies face distinct pressures, thus holding near current levels.
What could change it:
• Upside risk: A strong US economic report could boost the USD against the THB.
• Downside risk: Further geopolitical tensions or tariffs affecting the US could weaken the USD.
