BANGKOK, Thailand – The Thai baht is expected to trade between 33.30 and 34.00 per US dollar during November 2–6, with the US midterm elections, Middle East tensions and foreign investment flows among the key factors influencing its direction, Kasikornbank says.
Kasikorn Research Centre also highlighted Thailand’s October inflation figures and a series of major US economic releases, including manufacturing and services activity, non-farm employment, unemployment, job openings, factory orders and weekly jobless claims.
Markets will also watch the Bank of England’s policy meeting on November 5, eurozone inflation and manufacturing and services activity across major economies.
The baht initially weakened beyond 33.80 per dollar early last week as the US dollar gained on expectations that the Federal Reserve would maintain a cautious stance on inflation. Demand for dollars near the end of the month added further pressure.
The Thai currency later recovered after the Bank of Thailand’s Monetary Policy Committee kept its policy rate unchanged at 1.00%. Markets interpreted the committee’s statement as suggesting limited scope for further rate cuts, given its concerns about inflation risks and the effects of low interest rates on economic and financial stability.
The dollar also retreated following the Fed’s decision to maintain its policy rate at 3.75–4.00%, while US bond yields declined. Signals from the European Central Bank and Bank of Japan that tighter monetary policy could be considered at their December meetings also influenced currency markets.
On October 30, the baht closed at 33.68 per dollar, compared with 33.73 on October 22. Foreign investors were net buyers of 460 million baht in Thai equities during October 26–30, but recorded net outflows of 2.548 billion baht from the Thai bond market, including net bond sales of 2.148 billion baht and 400 million baht in maturing debt.
