Mr. Poon Panichpibun, Money Market Strategist, Krungthai Global Markets, Krung Thai Bank This week's baht range is expected to be 36.40-37.25 baht/dollar, and today's range is 36.65-36.85 baht/dollar, from today's (July 1) morning opening of 36.74 baht. dollar. That's down slightly from the previous week's close of 36.69 baht to the dollar.
The baht is moving sideways (oscillating in the range of 36.67-36.77 baht per dollar) following some strengthening and the dollar's contraction following the rise in gold prices since last Friday. After the US PCE inflation rate fell as expected in June, however, the dollar will weaken somewhat after the market acknowledges the US PCE inflation report. But the baht faces pressure from the flow of gold-buying transactions during the contraction period. Gold prices were lower than previously forecast after the U.S. 10-year bond yield continued to rise to 4.40% in June, supported by the U of Michigan Consumer Sentiment Index report.
Although the dollar strengthened last week following the depreciation of major currencies, particularly the Japanese yen, the mixed US economic data report helped the dollar weaken.
We reckon it's worth keeping an eye on the results of the first round of the French parliamentary election and the British general election this week. Including the Nonfarm Payrolls report in the United States, which can create volatility in financial markets.
As for Pat's trend, we assume that its rate of depreciation will slow down but still remain. It is at risk of the baht volatility and weakening to test the first resistance level of 37 baht per dollar. In the event that the dollar and US 10-year bond yields continue to rise. This will put additional pressure on the baht through falling gold prices. Includes the direction of the Chinese Yuan (CNY), which affects the baht during this period.
As for the dollar, we think the dollar will strengthen at the start of the week. Market worries over French election results put pressure on the Euro (EUR) to weaken, but US economic data reports are a further reflection of economic slowdown. Or it comes out worse than expected, leaving the dollar somewhat weaker.
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