Baht expected to move sideways as market awaits key US data
The baht opened at 32.74 to the US dollar on Monday, weakening from last week’s closing rate of 32.65.
The Thai currency is likely to move between 32.65 and 32.80 during the day and between 32.50 and 32.90 this week, Krungthai Bank market strategist Poon Panichpibool said.
Poon predicted that the baht would drift sideways in the short term. Foreign investors are keeping an eye on the Covid-19 situation in the country after the easing of lockdown measures, including the economic recovery and the Bank of Thailand’s policy. The Monetary Policy Committee will be meeting at the end of this month.
He said the dollar might be pressured if US economic data is worse than expected, especially retail sales and consumer confidence. Investors expect that the US Federal Reserve might not hurry to reduce quantitative easing at the meeting in September if the US economy slows down.
The dollar might still be in demand from the need for safe-haven assets if investors are in risk-off mode due to the economic recovery.
The key resistance level for the baht would be from 32.80 to 33.00 to the dollar, which is the level at which exporters might sell the US currency, Poon said.
Meanwhile, the key support level for the baht is 32.60 to th dollar, the level that some importers are waiting for to buy the US currency.