The Thai Baht (THB) is experiencing upward pressure against major currencies, with recent trading levels showing a significant rise. The THB to USD currently stands at 0.031338, which is 1.1% above its three-month average of 0.030987. Similarly, the THB to EUR at 0.026921 and the THB to GBP at 0.023515 also reflect gains of 1.1% above their respective averages. The Baht has traded within stable ranges, with the THB to JPY seeing a notable rise, currently at 4.8832, which is 3.5% above its average.
Key developments are influencing the Baht's trajectory. The Bank of Thailand is actively looking to curb the baht's appreciation, introducing measures such as increased monitoring of gold-related foreign exchange activities and proposing to raise the threshold for non-repatriated foreign income. This move aims to mitigate the impacts of a strong Baht on Thailand’s exports and tourism, as highlighted by economic analysts.
Adding to the pressure on the currency, Thailand's annual inflation rate has remained negative for eight consecutive months, dropping by 0.49% year-on-year in November. This decline, a result of falling energy prices and government support measures, indicates softer domestic demand. Consequently, the Federation of Thai Industries has projected a modest economic growth rate of 2% for 2025, hampered by external factors such as U.S. tariffs and declining tourism numbers.
Forecasts suggest that the Bank of Thailand may cut the policy interest rate by 25 basis points to encourage economic activity in light of reduced growth momentum. This potential rate cut, alongside ongoing efforts to address the strong currency, positions the Baht amidst a complex economic landscape.
Those engaged in international transactions may find value in monitoring these developments closely, as changes in policy and economic performance could further impact exchange rates in the near term.
