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Thai baht struggles for sustained gains as USD/THB retraces
OCBC said elevated oil prices and uneven tourism recovery, along with Bank of Thailand tolerance for orderly THB weakness, are headwinds for follow-through in baht strength.
OCBC strategists Sim Moh Siong and Christopher Wong said the Thai baht’s gains have been limited after USD/THB moved lower following the US CPI decline, but then retraced quickly into the next trading session.
They pointed to elevated oil prices and an uneven tourism recovery as ongoing headwinds for Thailand, arguing these factors can make it harder for THB to build sustained upside momentum after US data-driven moves.
The pair also highlighted that the Bank of Thailand appears to tolerate orderly Thai baht weakness, which they said may support a degree of policy acceptance of depreciation while still discouraging excessive volatility.
FXStreet reported USD/THB last traded in the 33.50 area, adding that near-term THB improvement could depend on whether broader Asian FX firms up if USD softness extends, though the pace could lag when oil remains elevated.