NZD/THB Outlook:
Slightly positive, but likely to move sideways as the NZD is above its recent average, yet mixed signals persist amid economic uncertainties.
Key drivers:
• Rate gap: The Reserve Bank of New Zealand appears poised for interest rate cuts while the Bank of Thailand has intervened to manage the Baht's strength, affecting overall interest differentials.
• Risk/commodities: Current high oil prices may support NZD, linking commodity costs to New Zealand's export revenues.
• One macro factor: Labour market instability in NZ is raising concerns, which could sustain downward pressure on the NZD if it persists.
Range:
Expect NZD/THB to hold within its recent range amid the mixed signals, with a tendency to drift rather than test extremes.
What could change it:
• Upside risk: Any positive shift in the New Zealand employment figures might boost the NZD.
• Downside risk: Heightened trade tensions or persisting labour market issues could weigh further on the NZD.