KUALA LUMPUR — The baht was the best-performing Asian currency this week as Thailand’s junta pledged to boost spending to revive economic growth. Indonesia’s rupiah led losses after the country reported a surprise trade deficit.
The Bloomberg-JPMorgan Asia Dollar Index, which tracks the region’s 10 most-active currencies excluding the yen, was steady for the week, erasing a decline after the European Central Bank cut interest rates to negative on Thursday, potentially spurring fund flows to emerging-market assets. Thailand’s military administration, which took over in a May 22 coup, promised to step up infrastructure development and increase investment in areas adjacent to the nation’s borders.
“The perception is that the new Thailand government has provided stability and improved conditions for growth,” said Dariusz Kowalczyk, a Hong Kong-based strategist at Credit Agricole CIB. The ECB’s stimulus programme is “positive for high-yielding currencies such as those in Asia,” he said.
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