USD/THB – Lagging Behind USD/EMS – Topside Rally Due

The US Dollar rallied against the Thai Baht to 32.65 from 32.55 yesterday in subdued trade. The Dollar’s climb against the Thai Baht was mild compared to its rise against the other Asian and EMS currencies. The USD/IDR pair (Dollar Indonesian Rupiah) was up 1.04% to 61,337.5 in contrast. USD/ZAR (USD – South African Rand) skyrocketed 1.7% after Moody’s cut South Africa’s credit rating.

USDTHB Chart - Trading View - 31 March 2020
USDTHB Chart – Trading View – 31 March 2020

The coronavirus outbreak has also taken its toll in Thailand with 1,524 confirmed cases, and 2 more deaths as numbers soared according to the Bangkok Post yesterday. More people have rushed to flee the capital Bangkok in the wake of a partial lockdown. These factors should see the USD/THB pair play catch up with the rest of the USD Asian and Emerging Market currencies.

The Bank of Thailand will continue to monitor the currency. USD/THB slumped to a 2020 low at 29.657 in January. The BOT quickly intervened to push the USD/THB higher to 30.20. While the USD/THB is near November 2018 highs (33.15), it is still far below the January 2016 peak at 36.40.
Look for a slow grind higher with a likely range today of 32.55-32.85. As the Covid-19 spread hits more densely populated Asian and EM countries, the USD/THB should hit fresh 2009 highs.

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