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THB: USD/THB Rebounds, But Still Sub key EMAs

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EM BulletBulletAPACEmerging Market NewsThailand

USD/THB is higher in the first part of Thursday dealings. We were last near 33.95, off around 0.40% in baht terms. We are still comfortably sub all the key EMAs, with the 20 to 100 day clustered in the 34.30-34.40 region. 

  • Some modest baht losses are consistent with broader USD trends, which have stabilized to a degree. the uptick in USD/JPY and modest gold losses will be THB headwinds at the margin as well. USD watchers are focused on US tariff risks, particularly with the Feb 1 deadline Trump announced yesterday.
  • US yields are down slightly today, but largely holding Wednesday gains. US-TH 2yr government bond yield differentials sit off earlier Jan highs, but are still strongly in the USD's favor, last around +222bps.
  • Locally, we had Dec customs trade data. Exports were slightly above expectations (+8.7% y/y, versus +7.4% forecast), while imports slightly below (14.9%y/y, versus 15.4% forecast). This saw only a modest trade deficit, although we structurally we haven't been able to move into a goods surplus.
  • Still, with the improving tourism backdrop, as arrivals trend back towards pre Covid levels, we could see a further improvement in the current account this year.
  • THB has been outperformer broader EM Asia trends over the past 6 months as well, so an improving external backdrop may already be priced to a degree. Some parts of the Thailand government also prefer a weaker FX. 
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USD/THB is higher in the first part of Thursday dealings. We were last near 33.95, off around 0.40% in baht terms. We are still comfortably sub all the key EMAs, with the 20 to 100 day clustered in the 34.30-34.40 region. 

  • Some modest baht losses are consistent with broader USD trends, which have stabilized to a degree. the uptick in USD/JPY and modest gold losses will be THB headwinds at the margin as well. USD watchers are focused on US tariff risks, particularly with the Feb 1 deadline Trump announced yesterday.
  • US yields are down slightly today, but largely holding Wednesday gains. US-TH 2yr government bond yield differentials sit off earlier Jan highs, but are still strongly in the USD's favor, last around +222bps.
  • Locally, we had Dec customs trade data. Exports were slightly above expectations (+8.7% y/y, versus +7.4% forecast), while imports slightly below (14.9%y/y, versus 15.4% forecast). This saw only a modest trade deficit, although we structurally we haven't been able to move into a goods surplus.
  • Still, with the improving tourism backdrop, as arrivals trend back towards pre Covid levels, we could see a further improvement in the current account this year.
  • THB has been outperformer broader EM Asia trends over the past 6 months as well, so an improving external backdrop may already be priced to a degree. Some parts of the Thailand government also prefer a weaker FX.