Light Selling Pressure Hits Baht After Strong Showing On Monday

Spot USD/THB has edged higher this morning as geopolitical angst surrounding Sino-U.S. tensions over Taiwan spills over across the region.

• The baht returned from a long weekend on Monday, garnering strength on the back of a firm M'fing PMI reading. It was unfazed by a slip in the BoT's Business Sentiment Index, which came in at 49.4 in July.
• The benchmark SET Index gained on Monday, ripping through its 50-DMA, which had been intact since Jun 1. The index tested key resistance from Jun 28 high/38.2% retracement of the Feb - Jul sell-off just shy of the 1,600 mark.
• The rate deals +0.067 at THB36.077, giving away some of yesterday's notable losses. A break above Jul 21 high of THB36.945 is needed to reignite bullish momentum. Bears look for losses past Jul 11 low of THB35.882, followed by the 50-DMA at THB35.382.
• The Bangkok Post reported that the planned power tariff hike has been postponed after an intervention by Prime Minister Prayuth as the authorities look to curb rising cost of living.
• As a reminder, the latest set of Thai CPI figures will be published on Friday, with headline inflation expected to have quickened to +8.00% Y/Y in July from +7.66% prior.
• In the meantime, the University of the Thai Chamber of Commerce will release consumer confidence data on Thursday.