Sat, November 27, 2021


Baht toes the dollar line amid uncertainties over Covid-19, US stimulus

The baht opened at 29.99 to the US dollar on Tuesday, unchanged from Monday’s close.

The Thai currency is likely to move between 29.90 and 30.10, Krungthai market strategist Poon Panichpibool said.

On Monday, investors’ concerns on the Covid-19 crisis across the world and lack of certainty of the US stimulus package caused the market to reduce its “reflation trades” status and focus on assets less affected by the virus crisis, as well as safe-haven ones.

This triggered fluctuation in the financial markets.

In the US, the Russell 2000 index fell by 0.3 per cent, while the Nasdaq increased by 0.7 per cent.

Meanwhile, the EU market was in a risk-off state, pressuring the Stoxx 50 to drop by 1.4 per cent.

Also, the German ifo Business Climate Index was worse than observers expected, Poon added.

The US Ten-Year Treasury dropped by over 5.6 basis points to 1.03 per cent. The dollar index rose by 0.14 per cent to 90.37 points, while the euro weakened by 0.3 per cent to 1.214 per dollar.

Poon said that the market today is monitoring results that would be announced by SET-listed companies. Moreover, the IMF World Economic Outlook was another interesting issue for the market.

He added that the dollar could move sideways in the short time, in case negative factors – intensified Covid-19 situation, poor results of listed companies, or delay in the US government’s assistance – happen.

In Thailand, the baht still moved in line with the dollar and foreign funds flow. Poon warned investors to beware of the purchasing power of the dollar at the end of this month.

Published : January 26, 2021