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SUNDAY, October 02, 2022
Baht strengthens, but all eyes on central bank meeting this week

Baht strengthens, but all eyes on central bank meeting this week

MONDAY, February 01, 2021
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The baht opened at 29.89 to the US dollar on Monday, strengthening from Friday’s close of 29.97.

The Thai currency is likely to move between 29.85 and 30.15 this week and between 29.95 and 30.05 on Monday, Krungthai market strategist Poon Panichpibool said.

This week, most of the market players were in risk-off state. Poon forecast that the market could fluctuate in case economic numbers turn out be negative.

In Thailand, most players are waiting for the result of Bank of Thailand’s meeting. The market strategist forecast that the central bank’s view towards the economy would change due to the second Covid-19 wave that began in December last year. The interest rate will likely be frozen at 0.50 per cent.

In the US, service businesses were pressured by the virus crisis, despite an overall recovery of businesses. The Non-Manufacturing ISM in January decreased from 57.7 points last month to 56.7 points. Meanwhile, the ISM Purchasing Managers' Index stayed at 60 points this month.

Non-farm payrolls increased only by around 50,000 positions.

In the EU, the economy in the fourth quarter of 2020, contracted by 5 per cent, compared to the fourth quarter of 2019. The Bank of England stayed its interest rate at 0.10 per cent.

Poon said that the dollar would tend to move sideways in the short-term. In case the market is disappointed with US stimulus measures, the Covid-19 crisis intensifies, or vaccine distribution is slow, the US currency would strengthen.

The dollar will weaken in case the market feels relaxed about economic recovery and US stimulus measures.

In Thailand, no factor could influence the baht, except the dollar's movement and foreign fund flow, he said.