Baht Takes Hit After Downbeat Comments From PM, BoT

Spot USD/THB re-opened on a firmer footing this morning, as overnight greenback strength coupled with downbeat comments from the BoT & PM Prayuth pushed the rate higher. It last trades at THB31.438 after printing a fresh cycle high at THB31.452.

• The BoT's Monetary Policy Report released Wednesday warned that the GDP could shrink 1.7% Y/Y in 2021 in the worst-case scenario, if foreign tourist arrivals don't exceed 100,000. The base-case forecast is for a 3% growth this year, based on the assumption that 3mn (prev. forecast: 5mn) tourists will visit the country. All in all, the document was interpreted as relatively dovish, with policymakers advising the gov't to prepare additional fiscal measures.
• PM Prayuth expressed a sense of concern with the resurgence of Covid-19 infections in Bangkok and suggested that fresh restrictions might be forthcoming.
• The University of the Thai Chamber of Commerce will release its consumer confidence gauge later today. Headline index printed at 49.4 in Feb.
• A Thai virus expert during a presser in the Health Ministry warned against unnecessary travel during the Songkran period, as worries about a potential spike in new infections resurface.
• USD/THB has approached the 50% recovery of the Apr 2, 2020 - Dec 18, 2020 sell-off at THB31.467 and a break here would open up Sep 28, 2020 high of THB31.745. Conversely, a slide through Apr 1 & 2 lows of THB31.198 would bring the THB31.000 mark into view.
• On Friday, the BoT will publish its latest update on foreign reserves.