Baht continues to slide on Friday but all eyes on US labour data
The baht opened at 33.31 to the US dollar on Friday, weakening from Thursday’s close of 33.25 and sliding for the sixth successive week.
Krungthai Bank market strategist Poon Panichpibool predicted the Thai currency would move between 33.20 and 33.40 during the day.
Poon said that the baht is likely to swing in a wide range as the risk-averse market spurs the dollar to strengthen.
The baht was being supported by the return of foreign inflows to the Thai stock market and the falling crude oil price after the US announced it would release 1 million barrels from its reserve.
Poon warned investors to beware of currency market volatility after the US employment data is revealed tonight. A worse-than-expected recovery in the US labour market would pressure the dollar to weaken, he added. However, if the US data matches the forecast, the currency market would remain stable as it had already priced in the US Federal Reserve’s rate-rise signal.
Poon forecast the baht’s resistance level would be 33.50 to 33.70, at which point exporters might offload the dollar. The key support level would be 33 to 33.20, which would spur importers to purchase the greenback.
The currency market has been risk-off since February’s invasion of Ukraine by Russia and a lack of progress in ensuing peace talks.
Meanwhile, the Fed has signalled will hike the interest rate in May and in June meeting after US inflation in February reached 6.4 per cent, the highest level in 40 years.
