Outlook
The Thai baht has strengthened to its strongest level in more than four years, supported by a softer US dollar and solid domestic fundamentals. While this aids importers and travelers, rapid appreciation raises concerns for exporters and tourism. Bank of Thailand policy responses and evolving capital flows will be key near-term drivers.
Key drivers
- Rapid baht appreciation: The currency has reached multi-year highs, potentially denting export competitiveness and tourism demand.
- Bank of Thailand FX oversight: The central bank has tightened scrutiny of foreign-exchange transactions, targeting gold traders and currency dealers to curb speculative flows.
- Illicit capital inflows via digital assets: Reports indicate funds moved into Thailand through digital assets, contributing to the baht’s strength and affecting the tourism outlook.
- 2026 forecast of continued appreciation: The Fiscal Policy Office expects the baht to strengthen further this year, aided by a weaker US dollar and solid fundamentals.
- Market backdrop: A softer US dollar and robust domestic data underpin a supportive environment for the THB, but policy actions and external shocks could cap further gains.
Range
THB/USD at 0.032222, 1.3% above its 3-month average of 0.031808, having traded in a stable 5.1% range from 0.030885 to 0.032456.
THB/EUR at 0.027243, 0.6% above its 3-month average of 0.027091, with a very stable 3.1% range from 0.026701 to 0.027522.
THB/GBP at 0.023821, 0.9% above its 3-month average of 0.02361, within a very stable 4.0% range from 0.023049 to 0.023982.
THB/JPY at 4.9734, just above its 3-month average, trading in a range of 4.8388 to 5.1007 (5.4% range).
What could change it
- Policy and market shocks: A renewed or deeper USD rally, or a shift in BoT policy/FX controls, could alter the pace and direction of THB moves.
- Capital flow dynamics: Changes in legitimate or illicit capital inflows, including regulatory actions on digital assets, could affect the currency.
- Trade and tourism development: Deterioration or improvement in export orders and tourism demand could influence THB sentiment and level.
