Baht weakens as foreign investors wary of domestic risk factors
The baht opened at 33.42 to the US dollar on Monday, weakening from the previous closing rate of 33.32.
The Thai currency is likely to move between 33.10 and 33.60 during the day and between 33.30 and 33.50, Krungthai Bank market strategist Poon Panichpibool predicted.
Poon said that the baht might strengthen with the investment from foreign investors while the dollar weakens. However, investors should be aware of domestic risk factors such as floods and the Covid-19 situation. The volatility of the gold price could also affect the baht.
Meanwhile, Poon said that the market is in a risk-on state this week, which might pressure the dollar to weaken. The dollar will not weaken much if the US Federal Reserve support the quantitive easing in next month and the US economic data is better than others.
Moreover, the baht weakening might slow down in the short term as a bearish divergence occurs.
The key resistance level for the baht would be at 33.50 to the dollar, which is the level at which exporters might sell the US currency.
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The baht’s key support level would be from 33.00 to 33.10, the level some importers are waiting for so they can buy dollars, he added.
Poon said that the currency market opened for more risks last week because investors eased their worries about inflation. Moreover, companies financial results were better than expected.
Moreover, Poon added that the market is waiting for companies financial results in the third quarter and the statement of Fed officials this week.
