BANGKOK, Thailand – Thai baht opened the trading day at 34.30 baht per dollar, showing significant depreciation from the previous week’s closing rate of 34.04 baht per dollar on November 11. This marked a continued downward trend in the currency’s value, driven by ongoing inflation concerns in the U.S. and rising yields in U.S. bonds, particularly after the release of the University of Michigan’s Consumer Sentiment Index for November and long-term inflation expectations, which exceeded market predictions.
The strong dollar and increasing U.S. bond yields have pressured the baht. These factors alongside expectations that the U.S. Federal Reserve may be less likely to reduce interest rates in the near future have further dampened sentiment for the Thai currency.
Additionally, the drop in gold prices—about $20 per ounce—has prompted some investors to buy gold during its price correction, further impacting the baht.
Looking ahead, the baht could range between 34.20-34.45 baht per dollar on Monday, with a broader weekly range of 33.95-34.65 baht per dollar. The continued strength of the dollar, foreign sales of Thai assets, and fluctuations in gold prices are expected to keep the baht under pressure. However, a potential rise in the Chinese yuan (CNY) could offer some support to the baht if market confidence in China’s economic recovery continues to build.
The current market environment suggests that the baht is likely to weaken further unless it strengthens beyond the 33.65 baht per dollar mark.
