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Baht expected to strengthen against dollar in the first quarter despite BOT move


The baht opened at 29.93 to the US dollar on Wednesday, unchanged from Tuesday's close. The Thai currency is likely to move between 29.85 and 30.05 on Tuesday, said Jitipol Puksamatanan, the head of “Easy Invest” team of SCB Securities.

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On Tuesday night, the financial markets recovered, but with fluctuations. The Stoxx 600 fell by 0.19 per cent, after the German government decided to extend the country's lockdown for another three weeks.

The S&P index rose by 0.71 per cent, while the VIX index stayed over 25 points, due to investors’ hopes from the senator election in the US state of Georgia.

Meanwhile, the price of gold increased to $1,951 per ounce, after the dollar weakened and the Australian dollar strengthened by 1.3 per cent. Besides, the US Ten-Year Treasury yield increased by four basis points to 0.95 per cent, reflecting that some investors have released safe haven assets from their hands.

In Thailand, the baht weakened after the Bank of Thailand launched a transaction programme called “Non-resident Qualified Company”, which allows foreign companies to conduct transactions with a Thai bank without condition on their outstanding balance.

Jitipol added that this programme would not affect the Thai currency in the long term. And the currency would strengthen to 29.3 per US dollar in this quarter.

 

Published : January 06, 2021

By : THE NATION