Baht advances as foreigners plough THB6.3 bn into short-term bonds
The baht opened at 33.45 to the US dollar on Thursday, strengthening from Wednesday’s closing rate of 33.48.
The Thai currency is likely to move between 33.40 and 33.50 to the greenback during the day, Krungthai Bank market strategist Poon Panichpibool predicted.
Poon said that the market is in a risk-on state which causes foreign investors to invest in Thai assets. Foreign investors speculated that the baht will strengthen and bought the short term bonds for 6.3 billion baht total. This was the first time that foreign investors bought short term bonds after the Omicron spread.
Moreover, the baht is likely to strengthen because it did not weaken past the level of 34 to the dollar. Exporters selling the dollar also caused the baht to strengthen.
Poon said that the baht support level is at 33.40 to the dollar, which the importers are buying the dollar will cause the baht to not strengthen much. However, the baht will strengthen heavily if foreign investors are investing back in the baht.
Poon said that the currency market will be highly volatile in this period. Business operators should be cautious and use hedging tools to manage the risk.
