Baht to rise further against US dollar
The Thai baht, appreciating by 2 per cent against US dollar so far this year, could further rise until the US rate outlook becomes clearer, said TMB Analytics.
TMB Bank's economic team said that portfolio inflows would continue until the US Federal Reserve sends a clearer signal when it would raise rates.
"Thai bonds remain attractive. Though yields are lower than US Treasuries', but the attractiveness is supported by the upward trend of the baht and Thailand's low inflation," it said.
US Treasuries' yields fell to 1.77 per cent on Friday, against 1.90 per cent in the previous week. The 10-year Thai bond yields on Friday were at 1.59 per cent, falling from 1.81 per cent from the previous week, thanks to foreign fund inflows. The Thai bond yields are expected to move in the range of 1.55-1.75 per cent this week.
According to TMB Analytics, last week the Thai bond market attracted Bt41 billion, pushing the year-to-date inflows to Bt180 billion.
The Fed is convening a monthly meeting this week.
At 5.30pm, the Thai baht was traded at 35.26 per dollar, up by 2.19 per cent from 36.05 at the beginning of this year.
TMB Analytics expected the baht to move in the range of 35-35.5 per dollar this week. The currency could be traded around 39-40 against euro and 30.9-31.8 against Japanese yen.
