USD/THB Continues To Climb, But Foreign Bond Inflows Pick Up

USD/THB sits just off session highs, last in the 34.45/50 region. Earlier we got to 34.53. Current spot levels put us 0.40% weaker versus closing levels from yesterday. We are still distance from resistance levels, with the 20-day EMA back at 34.77, while all other key EMAs sit above 35.00. Recent lows rest near 34.10.

• A weaker baht tone is in line with the broader recovery in USD sentiment, along with softer gold prices. Local equities sit off recent highs, while offshore investors have had a mixed start in terms of flows since the start of the year.
• Appetite for Thailand bonds has been stronger ($302mn in net inflow yesterday). The local parliament continues to discuss the FY 2024 budget proposal (with -693bn baht the projected deficit).
• PM Srettha also stressed that local monetary policy settings need to factor in the nature of the economic recovery, which was described as fragile in the PM's words.
• The Dec inflation print is due tomorrow. The market looks for similar trends to the Nov outcome. The next monetary policy meeting isn't until Feb 7.