Capital inflow needs to be watched for influence over Thai baht

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BANGKOK, 15 April 2011 (NNT) – Kasikorn Research Center (KResearch) has suggested that the foreign capital transfers should be monitored closely as it will play a great role in directing the Thai baht currency movement. 

KResearch reported that the Thai baht currency weakened slightly before Songkran holidays because of technical selling forces while some investors were buying more US dollars amid the speculation that the Bank of Thailand (BoT) would interfere to stabilize the currency.

In addition, purchases of Thai stocks by foreign investors were lessened before Songkran. Thai baht hence closed at 30.12 baht per US dollar on 12 April 2011, the last operating day before the long holidays compared with 30.0 baht per US dollar last Friday.

As for next week from 18 to 22 April 2011, KResearch expected that the baht might move in the range of around 29.90-30.25 baht per US dollar.

Domestic factors that must be monitored are investment by foreign investors in both Thai and Asian markets, intervention of the BoT to stabilize the currency, Thai export figures for March.

External factors that should be monitored include reports of important economic figures from the US such as April housing market index, sales of second-hand houses, house construction approvals, March leading economic index and others.