Baht strengthens, faces capital market pressure
The baht opened at 31.22 to the US dollar on Wednesday, strengthening from 31.27 at close on Tuesday.
The Thai currency is likely to move between 31.13 and 31.33, said Jitipol Puksamatanan, senior director of the chief investment office at SCB Securities.
On Tuesday, US financial markets recovered after investor concern receded temporarily on the economy and finances. The S&P 500 index increased by 0.5 per cent. However, the EU’s Stoxx 600 decreased by 0.4 per cent due to investor worries over Brexit and the Covid-19 crisis in Europe.
Financial markets were in a risk-on state, and the dollar weekend by 0.3 per cent compared to the other main currencies. The price of gold and oil rose by 0.2 per cent and 1.5 per cent, respectively, and the US Ten-Year Treasury yield increased by 2 basis points to 0.79 per cent.
As for the baht, Jitipol predicted it would be traded in a narrow range without any clear direction due to capital market pressure.
He advised investors to monitor the US stock market, as it could be a factor in strengthening the baht.