BANGKOK, Thailand – Thai financial markets are expected to remain volatile this week as investors closely monitor global trade developments, the selection of Thailand’s next central bank governor, and the release of second-quarter earnings from major domestic banks, according to a new report from Kasikorn Research Center (KResearch).
Baht Outlook and Key Currency Drivers
The Thai baht exhibited fluctuations last week, initially strengthening to a high of 32.19 baht per U.S. dollar before reversing course and weakening midweek to 32.56 baht. The currency then rebounded on Friday to close at 32.39, buoyed by a recovery in gold prices and favorable movements in regional currencies.
KResearch predicts the baht will move within the range of 32.30–32.80 baht per U.S. dollar in the week ahead. Key influences include global gold price trends, foreign investment flows, and updates on the U.S. Federal Reserve’s interest rate policy.
Stock Market Rallies but Faces Uncertainty
The Stock Exchange of Thailand (SET) Index rallied over the course of last week, adding more than 80 points and reaching a two-month high of 1,210.01 points, driven by optimism surrounding U.S.-Thailand trade progress and broader regional recovery hopes.
However, analysts remain cautious. Shares in the banking sector — a key driver of the SET — saw only modest gains amid concerns about soft Q2 financial results and lingering uncertainty over the appointment of the new Bank of Thailand (BoT) governor, which may affect future monetary policy direction.
Events to Watch This Week
According to Kasikorn Securities, the SET Index is expected to trade between 1,160 and 1,255 points this week. Major events and data points that could impact investor sentiment include:
– June export data from Thailand, which may offer insights into global demand trends.
– Second-quarter earnings reports from listed banks, with expectations of sluggish growth.
– Developments in U.S. trade policy, especially potential retaliatory measures that could affect Asian markets.
Key global economic indicators, such as:
– U.S. new and existing home sales
– Durable goods orders
– July PMI figures from the U.S., Eurozone, UK, and Japan
Eyes on the BoT Governor Selection
The pending appointment of a new BoT governor is particularly critical, as the successor will set the tone for Thailand’s monetary policy in the coming years. Investors are watching for signals on how the next governor may respond to economic headwinds including sluggish domestic consumption, high household debt, and currency volatility. (TNA)
