The baht firmed to a three-week high on Monday, gaining along with most Asian currencies against a subdued US dollar, while drawing relief from the anti-government protest passing peacefully at the weekend.
At the biggest demonstration in years, tens of thousands of protesters on Saturday cheered calls for reform of the monarchy as well as for the removal of Prime Minister Prayuth Chan-o-cha, a former junta leader, and a new constitution and elections.
"There was a lot of anxiety going into the weekend", said Kobsidthi Silpachai, head of capital markets research at Kasikornbank, adding that relief that that there was no violence gave "some impetus for the markets to strengthen this morning."
The baht gained 0.4%, marking its best day since Sept 1, while local stocks also rose.
Also lending support was the parliament passing the 3.29 trillion baht budget bill for the 2021 fiscal year starting in October, hoping to revive Southeast Asia's second-largest economy from a collapse in tourism and exports due to the Covid-19 pandemic.
The central bank meeting due on Wednesday, governor Veerathai Santiprabhob's last, is expected to leave rates unchanged at record low of 0.5%, Mr Silpachai said.
Other Asian currencies firmed too. Indonesia's rupiah extended Friday's gains, rising 0.4% to its highest level since Sept 2. The currency has been pressured this month by concerns over rising coronavirus cases and mooted changes to the central bank law, which could threaten its independence, but a decision last week to keep interest rates steady seems to have settled some of the jitters.
S&P Global signalled on Friday that Indonesia should handle any changes to the central bank law carefully to prevent any pressure on its markets and sovereign rating.
Stock markets across the region were rangebound, as a spike in coronavirus cases locally and in Europe put a dampener on global sentiment. Risks of increased military tensions between the United States and China as some Washington officials visited Taiwan last week also added to concerns.
"This dimension of military tensions are sobering reminders that any dial back in US-China tensions on the trade or commercial front may be no more than temporary relief", Riki Ogawa of Mizuho Bank said in a note.
Philippine stocks dipped 0.4% to lead losses, with consumer stocks weighing on the index. On Sunday, the country's confirmed infections in the country had swelled to 286,743, still the highest in the region.