Baht drops to its lowest in a month
The baht hit its lowest point in a month, opening at 33.05 to the US dollar, down from Monday’s closing rate of 33.15.
The Thai currency is likely to move between 33.25 and 33.45 during the day, Krungthai Bank market strategist Poon Panichpibool predicted.
Poon predicted that the baht would drift sideways. A factor that will cause the baht to strengthen is that the market is in a risk-on state which will also cause the dollar to weaken. Gold selling will also cause the baht to strengthen if the price goes up nearly 1,800 dollars per ounce.
However, foreign investment especially stocks might cause the baht to fluctuate. The baht will weaken if investors sell Thai stocks. In contrast, the baht will strengthen if investors buy Thai stocks.
Foreign investors are trading stocks this week until basic economy factors are clearly better and companies financial results were better than expected which analysts will decrease the valuation of Thai stocks because they are currently expensive.
The baht’s key support level would be at 33.50, the level some importers are waiting for so they can buy dollars, he added.
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The support level of 33.00 is important because foreign investors speculated that the baht will weaken to 34 or 35 to the US dollar. Investors might place a stop loss at 33.00. Investors might cover short when the baht reach that level which will cause the baht to strengthen in the short term.
