Halister News

(Bloomberg) -- USD/THB may advance toward 21-DMA at 35.00 if BOT surprises with a rate cut or dovish outlook at today’s policy meeting, according to Bloomberg strategist Mark Cranfield.

• Momentum studies suggest USD/THB downtrend since early June is entering overextended territory; click here for chart
• USD/THB snaps six-day falling streak, is up 0.1% to 34.78
• Bank of Thailand is forecast to hold benchmark rate at 1.5%, according to 22 of 23 economists in Bloomberg survey; one sees a cut to 1.25%; decision due at 2:30pm local time
• Thai economic growth this year is likely to be 3.2%, below potential growth of 4% to 5%, UOB economists write in note
  • Political calm over the next few months will accelerate public expenditures, in addition to a more consistent contribution from tourism
  • However, offsetting this will be a fragile global economic recovery, structural constraints on key export sectors and a moderate recovery in purchasing power of both farm and non-farm households
• Overseas investors bought net 23.6b baht of Thai bonds yesterday, the most in almost two months, according to Thai Bond Market Association
• Yield on 3.85% govt bond due Dec. 2025 is steady at 2.028%
• Thailand 5-year credit protection rose yesterday by 1.7 bps to 95.2 bps, highest daily close since July 19, according to CMA New York data
• NOTE: Mark Cranfield is an FX strategist who writes for First Word. The observations he makes are his own and are not intended as investment advice.