Thai Baht Under Pressure
The Thai baht traded around 33.8 per US dollar, hovering near its weakest level since July, as the Bank of Thailand maintained its accommodative monetary stance. The central bank unanimously kept its policy rate unchanged at 1.00% for a fourth consecutive meeting, as expected, stating that the current rate remains appropriate to support the economic recovery, diverging from regional peers that have tightened policy to curb inflation. The decision reinforced expectations of persistently low domestic borrowing costs, limiting the baht’s yield appeal amid a firmer US dollar. Policymakers raised its GDP growth forecasts to 2.4% for 2026 and 2.1% for 2027, from 2.3% and 1.8%, respectively, in its June projections, but noted that growth remains below potential. Meanwhile, elevated oil prices are increasing Thailand’s energy import bill, adding to external pressures as the trade deficit widened to $5.86 billion in September from $2.48 billion in August.
The Thai baht traded around 33.8 per US dollar, hovering near its weakest level since July, as the Bank of Thailand maintained its accommodative monetary stance. The central bank unanimously kept its policy rate unchanged at 1.00% for a fourth consecutive meeting, as expected, stating that the current rate remains appropriate to support the economic recovery, diverging from regional peers that have tightened policy to curb inflation. The decision reinforced expectations of persistently low domestic borrowing costs, limiting the baht’s yield appeal amid a firmer US dollar.
Policymakers raised its GDP growth forecasts to 2.4% for 2026 and 2.1% for 2027, from 2.3% and 1.8%, respectively, in its June projections, but noted that growth remains below potential. Meanwhile, elevated oil prices are increasing Thailand’s energy import bill, adding to external pressures as the trade deficit widened to $5.86 billion in September from $2.48 billion in August.