Baht continues to weaken as investors worry over new Covid strain Omicron
The baht opened at 33.63 to the US dollar on Monday, weakening from the previous closing of 33.59.
The Thai currency is likely to move between 33.55 and 33.75 during the day and between 33.35 and 34 during the week, Krungthai Bank market strategist Poon Panichpibool predicted.
Poon said that the baht might continue to weaken due to the Omicron variant of Covid-19. However, Poon thought that the baht will not weaken much because the gold price will support the baht if it goes up. Exporters are also waiting to sell the dollar which causes the baht’s resistance level to be from 33.70 to 34.00 to the dollar.
The baht might be volatile as the market is in a risk-off situation might cause foreign investors to sell Thai stocks. Foreign investors also closed the risk after the baht suddenly weakened while foreign investors had sold 18 billion baht of short term bonds last week.
Poon said that the dollar might move sideways if the market is worried about the Covid-19 situation which will support safe-haven assets such as the Japanese Yen. The dollar will be supported if the US employment data is better than expected.
The market is waiting for the signal from US Federal Reserve officials that will affect the dollar’s direction. The dollar will strengthen if the Fed decided to decrease quantitive easing or increase policy interest rate next year.