USD/THB Tracks Recent Ranges, Portfolio Outflows A Near Term Headwind

USD/THB is lower today, back to 34.30/35, around 0.25% stronger in baht terms for the session. This is bucking the generally the firmer USD/Asia trend elsewhere, but likely reflects some catch up to USD weakness post yesterday's onshore close. More broadly, we continue to track a range trade for the pair. On the topside, the 100-day EMA around 34.53, presents a cap on the upside, while dips sub 34.20 have been supported.

• One constraint seen on THB upside is persistent bond outflows this month, now up to $800mn for April to date. Nervousness around the Thai election (scheduled for Mid May) in terms of the fiscal outlook is one the factor, on-going policy normalization potentially the other, which is something the BoT reiterated this week.
• This may be more relevant now with other central banks in the region pausing and are offering more value from a bond standpoint.
• Equity outflows have been modest but still present, particularly this past week, -$145.5mn. Thai equities aren't too far off recent lows, last around 1571 for the SET (multi week lows at 1560/61 set earlier today).
• On the data, next week delivers March trade figures, with export growth expected to slip further (-15.20% y/y forecast), while March IP also prints.