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Baht weakens over stronger dollar while gold prices fall

The baht opened at 36.29 to the US dollar on Monday, weakening from Friday’s close of 36.03.

The Thai currency will likely move between 36.20 and 36.40 against the US dollar during the day and between 35.80 and 36.40 during the week, Krungthai market strategist Poon Panichpibool predicted.

Poon said the baht will possibly weaken as the dollar strengthens and the gold price heads down.

He suggested monitoring foreign investors’ transactions. He also expects the Thai stock index to drop next week in response to the falling US stock index, though this will encourage foreign investors to buy Thai stocks instead.

Meanwhile, the market expects the US Federal Reserve to increase the interest rate by 0.75 per cent in September. The US dollar may strengthen further if the US labour data is better than expected.

The European Central Bank’s indication that it may increase its interest rate may support the euro and slow down the dollar’s strengthening.

Poon advised investors to use hedging tools to manage risks in a highly volatile currency market.

Credit The Nation

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