USD/THB Outlook:
Slightly weaker, but likely to move sideways, as it is below its recent average and lacks a clear current driver.
Key drivers:
• Rate gap: The Federal Reserve's decision to hold interest rates steady contrasts with the Bank of Thailand's actions to stabilize the baht, affecting USD/THB dynamics.
• Risk/commodities: Recent oil prices, trading at highs and above average, could put upward pressure on the THB as Thailand is sensitive to oil market fluctuations.
• One macro factor: The concerns regarding Thailand's strong baht from shippers highlight challenges for exports, which could lead to calls for intervention, reflecting economic pressures.
Range:
The USD/THB is likely to drift within its recent 3-month range with limited movement.
What could change it:
• Upside risk: A surprise increase in US non-farm payroll numbers could bolster USD strength.
• Downside risk: Continued geopolitical tensions and a pronounced drop in US consumer data could further weaken the USD.