Political Uncertainty Amplifies Pressure On Baht, Customs Trade Data On Radar

Broad-based demand for the greenback generated a leap higher in spot USD/THB, which last trades +0.305 at THB37.770, just shy of fresh cyclical highs. Overhang impetus from after-hours Friday and the resumption of aggressive sterling sales have helped lift the pair in early Monday trade. The baht is the second worst performer in emerging Asia today.

• From a technical standpoint, bulls set their sights on Sep 19, 2006 high of THB37.951, with bears keeping an eye on the increasingly distant 50-DMA (THB36.366).
• Heightened political uncertainty in Thailand is amplifying THB vulnerability as the latest NIDA poll showed a plurality of Thai voters don't have their preferred candidate for PM.
• Offshore investors sold a net $72.82mn in Thai stocks last Friday, extending the downward trajectory in foreign inflows. The SET index retreated, losing ~0.8% come the closing bell.
• Dep PM Supattanapong, FinMin Arkhom and BoT Gov Sethaput will speak at a debt restructuring briefing today.
• The Customs Dept will publish monthly international merchandise data today. A Bloomberg survey of economists suggests that trade deficit narrowed to $3.044bn in August from $3.660bn prior.
• Looking further afield, the BoT will announce its monetary policy decision on Wednesday. Most analysts expect the Committee to raise interest rates by 25bp, with others forecasting a 50bp rate hike.