Thai Baht Set to Weaken as US Tariff Tensions Escalate

[webfact]

Picture courtesy: Kasikorn Research Centre

 

The Thai baht is anticipated to weaken in the coming weeks, largely due to increasing global trade tensions in the wake of the United States' recent decision to elevate tariffs on aluminium and steel imports to a flat rate of 25%.

 

On Tuesday, the baht commenced trading at approximately 33.96 per US dollar, a slight appreciation from Monday's closing rate of 33.91, but it soon weakened, surpassing 34 baht during the day's trading, reaching 34.07 per dollar by late afternoon.

 

Poon Panitchpibun, a money market strategist at Krungthai Global Markets, explained that the baht's depreciation followed the announcement by US President Donald Trump of a significant tariff increase on steel and aluminium imports. The tariffs, now at 25%, represent a substantial rise from the previous 10%, marking the end of various exemptions and agreements.

 

This strategic trade move by the US has exerted pressure on the baht, said Mr Poon, as the US dollar strengthened in response to these measures. Despite opening at 33.89 on Monday—down from last Friday's 33.64 closing—the baht's weakening has been compounded by mounting market uncertainty.

"If the baht continues its decline and breaks through the resistance threshold of 34-34.10 per dollar, it might challenge the 34.20 zone next," he suggested. He further noted that the baht could stay volatile depending on the evolving US trade policies and economic statistics. The global upswing in gold prices has offered some respite, yet a short-term correction in the gold market is possible given recent peaks.

 

Kanjana Chockpisansin, who heads research in the banking and financial sector at Thailand's Kasikorn Research Center (K-Research), observed that the baht's dip past 34 per dollar marks its lowest point in a week. This depreciation aligns with a general downward trend among regional currencies, largely spurred by the stronger US dollar amid shifting trade policies.

 

As global tensions are projected to escalate amidst ongoing US trade developments, Ms Kanjana advises close watching of forthcoming tariff enactments. In this climate, the US Federal Reserve might delay rate cuts, bolstering the dollar against the baht.

 

Looking forward, K-Research anticipates the baht to fluctuate within a range of 33.85-34.15 per dollar in the near term. As these economic dynamics unfold, both domestic and international market participants will remain on high alert, assessing the impact on trade and investment strategies, reported Bangkok Post.

 

-- 2025-02-13

 

 

[dinsdale]

I'm confused. Wasn't there an article not too long ago saying Baht strengthening because of tariffs?

[JoePai]

Thailand only exported (approx) US$330m to the US, a small amount so is that enough to cause problems to the Baht ?

[lordgrinz]

Again, unless it reaches 37-38 to USD, then its not even worth thinking about.....the baht is still too expensive, due mainly to manipulation.

[bamnutsak]

Hopefully, Trump will focus on Thigh Land, and leave Thailand alone.

 

 

[Yagoda]

Perfect! Im coming in next week, that means I save $10 on short time!

[KhunLA]

Since inauguration ... to today, basically unchanged.

So our world is not ending  because of Trump 

 

[scottiejohn]

1 hour ago, Yagoda said:

Perfect! Im coming in next week, that means I save $10 on short time!

Is that all you charge for a short time?

[Yagoda]

3 minutes ago, scottiejohn said:

Is that all you charge for a short time?

Hi puppy. Yap yap yap. 

[CallumWK]

1 hour ago, Yagoda said:

Perfect! Im coming in next week, that means I save $10 on short time!

 

You pay in Thai baht in Cambodia?

[CallumWK]

5 hours ago, webfact said:

On Tuesday, the baht commenced trading at approximately 33.96 per US dollar, a slight appreciation from Monday's closing rate of 33.91,

 

So weakening is an appreciation these days?

[Tompa]

1 hour ago, JoePai said:

Thailand only exported (approx) US$330m to the US, a small amount so is that enough to cause problems to the Baht ?

Not sure where you got that number? Thailand export usd billions every month.

https://www.ceicdata.com/en/indicator/thailand/total-exports-to-usa