Baht soars, biggest gain in a year
published : 11 Jun 2020 at 11:38
writer: Bloomberg News
The baht surged the most in a year on Thursday, defying a selloff among emerging Asian currencies and testing the central bank’s patience after it warned of economic risks from continued appreciation.
The baht advanced as much as 1.1% against the dollar, the most since June 2019. The Thai currency has breached its 200-day moving average resistance, a technical pattern that could encourage speculative inflows.
At the start of June, the Bank of Thailand said it was concerned about the baht’s recent and rapid appreciation and added it was ready to take steps to curb a climb that could imperil an already fragile economy.
Thailand’s economy relies on tourism and trade, both of which have been badly damaged by the novel coronavirus pandemic. Officials expect an economic contraction of as much as 6% this year and are sensitive to currency strength that could hamper competitiveness.
Finance Minister Uttama Savanayana told reporters in Bangkok on Thursday that it is the central bank’s job to make sure the baht is not an obstacle, adding the currency should move line with the economic recovery.
The baht strengthened 0.7% as of 10.40 am, climbing for the fifth straight day. Thai stocks slid as much as 0.7% before paring some of the decline to trade little changed.