Rallies Early Doors Amid Election Optimism

USD/THB is down sharply in the first part of trade, post Sunday's election outcome. The pair last tracked in the 33.70/75 region, around 0.80% firmer in baht terms versus Friday's closing levels. This is all the more impressive given broad USD gains through Friday's session.

• Recent lows in the pair come in at 33.57, which was fresh lows back to early Feb of this year. Beyond that is the low 33.40 region and then round figure support at 33.00.
• The market appears to be welcoming the election result from Sunday, with the opposition parties getting well over 50% of the vote. Move Forward is doing better than expected but in a very close race with Pheu Thai. Together they are headed to win over half of the 400 constituent seats and over half of the 100 seats allocated by proportional representation (see this link).
• How the government exactly takes shape remains to be seen though, with negotiations having to take place between these parties and also with the Senate, which has favored the military junta in the past.
• Both these parties appear to have a more pro-growth agenda, with plans for cash handouts and boosting minimum wages.