Baht Weakens, BoT Governor States Focus Should Be on Normalizing Policy Settings

USD/THB has gravitated higher, although has found some selling interest above 34.50 in the last part of trade. Moves above 34.50 or towards this region have generally been faded by the market going back to mid-March. Note the 100-day EMA is nearby, around 34.53. A modestly firmer USD backdrop, coupled with lack of portfolio inflow momentum remain headwinds for the baht.

• A host of comments from the BoT Governor have hit the wires. They look to be in line with previous commentary around the inflation, growth and tourism outlooks for 2023.
• The Governor also noted that monetary policy decisions are data dependent, although the focus should remain on financial stability and normalizing conditions (for both monetary policy and fiscal policy).
• Elsewhere, local equities are close to flat, struggling to see much upside from recent lows. We did see some offshore inflows on Friday, but net outflows were still evident for the whole week (-$111.7mn, likewise on the bond front (-$411.1mn).
• The local election race appears to be tightening, see this link for more details.
• While the data calendar has March customs trade figures on Wednesday. Export growth is expected to contract further (-14.85% y/y) but the BoT expects better growth in H2, as China aids the outlook.