Baht continues downward trend
The downward trend of the Thai baht continues on the back of US dollar rally.
As of 2.25pm, the baht was at 33.74 per dollar, from yesterday close of 33.64. It recently fell to the six-year low at 33.78-79. The greenback has also strengthened against other major currencies as well as the currencies in Asean.
Yesterday, the dollar was above 13,000 Indonesian rupiah, the level unseen since 1998.
The baht has fallen sharply since the Bank of Thailand cut the policy rates while the central bank governor signalled the bias towards a weaker currency, to revive the domestic economy.
Many currency strategists predicted the upswing would start next month on expectations that Fed Chair Janet Yellen will set the stage for a hike in the third quarter at the upcoming policy meeting.
The Fed has said that a rate rise, which most economists expect will come in September, will be dependent on improving economic data. Friday's employment report could provide a spark if new jobs created in May exceed the 225,000 market consensus.
"The onus on economic data to surprise sharply to the upside over the next few weeks is fairly high, else the Fed may be unable to prepare the market at the June FOMC for hikes commencing in Q3," analysts at Barclays wrote in a note.
