Thai baht depreciates against US dollar

After a recent surge of strength by the Thai baht earlier this month, it has now depreciated against the US dollar. As of today, December 16, the baht now stands at about 35 per USD, according to an executive at Kasikorn Research Center, Kanchana Chokpaisarnsilp.

Yesterday, the baht was at 34.92 per USD, Daily News reported.

Market strategist Poon Panichphiboon said the US financial market is turning to more risk-off conditions amidst concerns that the Federal Reserve’s rake hike trend.

According to the latest US economic data, retail sales in November contracted -0.6% from the previous month. This was much worse than expected and has caused concern about the US economic outlook.

Related news

In European stocks, Europe’s STOXX600 index tumbled -2.85% amid concerns about the prospect of further rate hikes by major central banks. The European Central Bank (ECB) raised its policy deposit facility rate by 0.50% to 2%, signalling that it will continue to raise interest rates until it is confident that it can successfully control inflation.

The ECB has announced plans to reduce its Balance Sheet Reduction by 15 billion euros per month from next March until the end of the second quarter.

Earlier this month, on December 2, the Thai baht had opened at 34.78 against the US dollar. Economic growth this year was expected to be at 3.2%, lower than the prior projection of 3.3%, according to the central bank.

Thailand’s currency is facing pressure from the depreciating USD, gold sales, and foreign investors possibly buying more Thai bonds amid continuous drops in the US 10-Year bond yields.

However, economists had high hopes for the baht in the long run. Capital Market Research Specialist at Kasikorn Bank Kittika Boonsrang predicted that the Thai baht could get to a high of around 33.5 to 34 per USD by the end of next year.

Kittika added that the forecast would only be achievable if Thailand pumped up exports and ramped up tourist arrivals.

Economy NewsThailand News

Tara Abhasakun

A Thai-American dual citizen, Tara has reported news and spoken on a number of human rights and cultural news issues in Thailand. She holds a Bachelor’s Degree in history from The College of Wooster. She interned at Southeast Asia Globe, and has written for a number of outlets. Tara reports on a range of Thailand news issues.

Related Articles