Baht Poised for Dip to 35 per USD by Mid-2025, Experts Predict

[webfact]

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The Thai baht is predicted to weaken to around 35 per US dollar by mid-2025, according to forecasts from Standard Chartered Bank (Thai). This anticipated dip is largely attributed to escalating global trade tensions, particularly between the US and China.

 

Tim Leelahaphan, Vice-President and Economist at the bank, highlights trade disputes among international partners as a principal factor in the baht’s expected depreciation. The prediction notes that by the second quarter of 2025, these tensions will negatively impact the baht's strength, though the currency is anticipated to partially rebound to approximately 34.50 by the year's end.

 

This year is also set to see significant volatility in the baht compared to other regional currencies. Contributing factors include shifts in gold prices and the performance of Thailand’s vital tourism sector, Mr Tim explained.

 

Reflecting on recent history, the baht began 2024 at about 34 to the USD, weakened to nearly 38 by August, then appreciated to 32, influenced heavily by internal political dynamics. It concluded the year steady at around 34 to the dollar.

 

Looking forward, Standard Chartered expects the Bank of Thailand's Monetary Policy Committee (MPC) to maintain its interest rate at 2.25% in its meeting tomorrow. This stance reflects ongoing economic recovery and stable prices, offering a balanced policy approach. The MPC will also weigh the potential risks from trade conflicts and monitor domestic economic conditions closely.

Tim Leelahaphan remarked, "Our analysis points to an 80% probability that the central bank will keep the current policy rate during the upcoming meeting and into the next quarter. Any rate cut, potentially by 0.25 percentage points to 2%, is anticipated in June."

 

There’s a strategic intent to preserve policy flexibility in anticipation of evolving trade tensions, particularly surrounding US trade policies, which are expected to become clearer by mid-year. Meanwhile, the US Federal Reserve is anticipated to delay policy rate adjustments previously expected sooner.

 

Amidst these financial conditions, Standard Chartered forecasts Thailand's GDP will grow by 2.8% in 2025, buoyed by strong performances in tourism and domestic spending.

 

Thailand’s tourism sector is notably recovering well, with foreign arrivals reaching 3.97 million by early February, matching pre-pandemic figures from 2019. This resurgence is expected to gain momentum in the second half of the year.

 

Moreover, the third phase of the government’s digital wallet initiative, allocating a substantial 140 billion baht (approximately 1% of GDP), is set to commence in the second quarter, providing a further boost to consumer spending.

 

Despite these positive indicators, Mr Tim warns of heightened uncertainty in the coming months, particularly concerning US trade policy impacts, which could introduce additional economic risks in later quarters, reported Bangkok Post.

 

-- 2025-02-25

 

 

 

[BayArea]

30 minutes ago, webfact said:

 

The Thai baht is predicted to weaken to around 35 per US dollar by mid-2025

WHOOPIE!!! Wake me up when is around 40 and upwards!

[TheAppletons]

The resident economics writer at the Bangkok Post, Chartchai Parasuk, is predicting a Thai financial system collapse in 2025.  

 

Thailand's Financial System on the Brink is the title of the essay.  Dated 20 Feb 2025.  

 

If that were to happen, the Thai baht would likely be decimated.

[henryford1958]

Basically they haven't a clue. Could go either way.

[sammieuk1]

Now where has that been said in the last 9 years ..🤔

[connda]

Yay!  🇺🇸 

[jayceenik]

A few months ago the Euro was at THB 39+. I wanted to bring in my FCD Euros but wife said wait for 40...

[Harrisfan]

33 minutes ago, henryford1958 said:

Basically they haven't a clue. Could go either way.

Like all these clowns in suits

[Harrisfan]

42 minutes ago, TheAppletons said:

The resident economics writer at the Bangkok Post, Chartchai Parasuk, is predicting a Thai financial system collapse in 2025.  

 

Thailand's Financial System on the Brink is the title of the essay.  Dated 20 Feb 2025.  

 

If that were to happen, the Thai baht would likely be decimated.

A writer