USD/THB Holding Sub 34.00, BoT States Baht Gains In Line With Other Asia FX

USD/THB is holding underneath 34.00 in latest dealings, around 0.30% stronger in baht terms. This leaves us close to recent lows of 33.875, recorded on Monday this week. July 2023 lows were at 33.76, while May lows from that year touched 33.57.

• Like other parts of South East Asia FX , USD/THB has been in oversold territory in recent weeks. The BoT Governor has been on the wires today stating that the central bank is monitoring baht movements very closely but that the movement is in line with regional currencies.
• In the past 3 months the baht has been a clear standout in the space, along with MYR, both up nearly 8% in spot terms. THB still lags in terms of YTD performance, with SGD and MYR the strongest gainers so far this year. The rise in gold and shift in Fed expectations were cited as Baht positives.
• The BOT Governor also noted the need to preserve policy space, and no signs of deflation (despite low inflation). Both these comments and those on THB don't suggest any dramatic near term policy shifts from the BoT.
• The government is looking at ways to boost underwhelming growth, with cash handouts potentially beginning in September
• Yesterday's customs trade data showed a deficit of nearly -$1.4bn, as imports rebounded more than forecast. We get more information on trade data this Friday.