BANGKOK, Thailand – Market Strategist at Krungthai GLOBAL MARKETS, Krungthai Bank, Poon Panichpibool, reported that the Thai baht opened this morning (Sept. 11) at 33.65 per U.S. dollar, appreciating from the previous day’s close of 33.75. The baht is expected to trade within a range of 33.50-33.90 today. Volatility is anticipated, especially following the U.S. presidential debate and the release of the U.S. Consumer Price Index (CPI) inflation report.
Since last night, the baht has strengthened steadily, trading between 33.64 and 33.77 per USD, despite the U.S. dollar moving sideways. The baht received support from rising gold prices, which approached USD 2,520 per ounce amid cautious financial markets in both the U.S. and Europe. A drop in the U.S. 10-year bond yield also contributed to the baht’s appreciation. The rise in gold prices has prompted some market players to take profit, boosting the baht through related financial flows.
However, the baht’s appreciation slowed around 33.65 per USD, partly due to oil import transactions following a sharp 2.5% drop in crude oil prices. This decline resulted from OPEC’s downward revision of oil demand forecasts for this year and next.
The key focus is on the U.S., with the presidential debate between Kamala Harris and Donald Trump occurring around 8:00 a.m. Thai time. The debate could impact financial markets, especially if it alters market perceptions of either candidate’s chances of winning the election. Additionally, at 7:30 p.m., the release of the U.S. August CPI inflation report is anticipated, which could influence the Federal Reserve’s interest rate trajectory.
Regarding the baht’s outlook, while there is potential for it to weaken, its recent sustained appreciation since yesterday afternoon suggests caution in predicting a clear reversal. The baht is likely to trade sideways near 33.65 per USD, with key support at 33.50 and resistance around 33.80-34.00 per USD.
Traders should also be aware of potential volatility following the U.S. debate. If Trump is seen as gaining an advantage, it could lead to renewed interest in “Trump Trades,” potentially boosting the U.S. dollar and 10-year bond yields. On the other hand, if Harris appears to have the upper hand, the dollar and bond yields could face downward pressure.
Lastly, traders should watch for the market’s response to the U.S. CPI report. A higher-than-expected inflation rate could lead to reduced expectations for Fed rate cuts, pushing the dollar and U.S. bond yields higher, potentially impacting gold prices and the baht.
