This morning, the Thai baht strengthened significantly, opening at 31.77 baht per dollar. 

The Thai baht opened this morning at 31.77 baht per dollar, significantly stronger than the previous day's closing level of 32.08 baht per dollar.

10 Mar 2569 Mr. Poon Panichphibun, money market strategist, Krungthai GLOBAL MARKETS, Krung Thai Bank It was revealed that the Thai baht opened this morning at 31.77 baht per dollar, significantly stronger than the previous day's closing level of 32.08 baht per dollar.

Since overnight, the Thai baht (USDTHB) has strongly strengthened, breaking through the 32.00 baht per dollar support zone in the early hours of Asian financial markets (fluctuating between 31.62-32.12 baht per dollar). This followed a sharp weakening of the US dollar and a rebound in gold prices (XAUUSD). Around 2:02.15 AM Thailand time, US President Donald Trump reiterated that the conflict in Iran may be nearing its end, easing market concerns about the Middle East conflict. This development pressured crude oil prices down to the $90 per barrel zone and boosted expectations of a Federal Reserve (FED) interest rate cut (currently, market participants give a 72% chance of two rate cuts this year), leading to increased risk appetite.

For the trend of the baht value

Although the Thai baht (USDTHB) has rebounded sharply and rapidly after market participants eased their concerns about the conflict in the Middle East, high uncertainty remains. Therefore, we reiterate our view that market players should use scenario analysis, even though recent developments are beginning to align with our base case scenario. Furthermore, the baht's recent movements reflect unusually high volatility, meaning market players should utilize options strategies to effectively manage exchange rate risk.

In terms of the base case scenario, we see a 40% probability (reduced from our previous estimate due to the escalating tensions over the past weekend). The conflict between the US, Israel, and Iran is unlikely to escalate and become prolonged. While Iran may unofficially close the Strait of Hormuz, it may not ultimately resort to military force to block shipping lanes as it is currently doing. In this scenario, Brent crude oil prices might remain high around $100 per barrel for a short period before gradually declining back to pre-conflict levels around $70 per barrel (this may already be happening).

If the fighting situation is indeed likely to end soon (as President Donald Trump recently stated), which could happen within a month, central banks will no longer be concerned about inflation trends. This would likely put downward pressure on safe haven assets like the dollar and gold. The dollar's direction will depend on market participants' views on the FED's interest rate outlook after the release of US economic data. Similarly, we believe gold prices may decline somewhat if market concerns about the Middle East gradually ease and financial markets become more risk-on. Therefore, even if the baht weakens slightly in the short term, breaking through the resistance zone of 32.00 baht per dollar, it may not be able to significantly surpass that zone. Furthermore, if the situation resolves by March, we believe the baht might strengthen somewhat by the end of the first quarter, reaching around 31.50 +/- 0.25 baht per dollar, before weakening further due to dividend payments in the second quarter, which is typically the low season for tourism and overall exports. We maintain our previous view that... The Thai baht may weaken to around 32.25 +/- 0.25 by the end of the second quarter before gradually strengthening, ending the year around 31.50 baht per dollar.

We believe that, considering military and political factors, President Donald Trump may be seeking to end the fighting within the previously stated timeframe of 4-5 weeks. This is especially true given the upcoming midterm elections, where President Trump's approval ratings have been steadily declining and are considerably below the levels of his "Trump 1.0" administration. This gives us hope that the fighting could end within that timeframe, and that our assessment of financial market trends would be closer to our base case scenario (and from a humanitarian perspective, we strongly hope the fighting will end even sooner).

Furthermore, from a technical perspective, although the baht has gradually appreciated somewhat, it will not return to an appreciating trend as long as it cannot clearly break through the 31.50 baht per dollar zone. Therefore, the baht may fluctuate in a sideways range for now, awaiting further developments. The key factor remains the development of the conflict in the Middle East.

We estimate that the volatility of the Thai baht is at risk of increasing and at least exceeding its historical average, amidst uncertainty surrounding market players' views on the Federal Reserve's (FED) interest rate outlook, as well as those of other major central banks. Other key political factors include the upcoming US midterm elections, the direction of US trade policy, and the consideration of import tariffs (specifically the IEEPA tax refund issue), as well as geopolitical risks. Therefore, we believe market players should consider using options strategies or leveraging local currencies to enhance exchange rate risk management.

Looking at the baht's range in the 24 hours, it is expected to be at 31.55-31.85 baht/dollar.

Other market views

US stock market The market experienced high volatility, initially pressured by concerns over a potential prolonged conflict in the Middle East. However, US stock markets rebounded rapidly after President Donald Trump suggested the conflict in Iran might be nearing its end, easing market concerns. This boosted AI/semiconductor tech stocks, such as Nvidia (up 2.7%), resulting in the S&P 500 closing up 0.83%, while the Nasdaq tech index fell 1.38%.

on the shoreeuropean stock market The European STOXX 600 index continued its decline by approximately -0.63%, pressured by concerns that the conflict in the Middle East could be prolonged, impacting global energy prices, the European economic recovery, European inflation trends, and the monetary policy stance of European central banks. However, European stock markets received some support from gains in energy and military/aviation stocks, which still benefit from the Middle East conflict.

In the sectionBond Market The 10-year US Treasury yield reversed course and fell back to the 4.10% zone as market participants gradually eased concerns about the escalating conflict in the Middle East and expectations for a Federal Reserve interest rate cut increased again. At the same time, the overall risk-averse sentiment in financial markets slowed the upward movement of the 10-year US Treasury yield, preventing it from exceeding 4.20%.

Overall, we believe that the 10-year US Treasury yield is likely to remain volatile and could easily rise further if the market lowers its expectations for further FED interest rate cuts. This depends on several factors, including the highly uncertain situation in the Middle East, US economic data such as CPI and PCE inflation figures to be released this week, and the IEEPA import tariff repayment issue. We maintain a neutral view on long-term US bonds (including long-term Thai bonds) and reiterate our recommendation that market participants should wait for opportune moments to gradually purchase long-term US and Thai bonds, such as around 4.25% for the 10-year US Treasury and around 1.90% for the 10-year Thai Treasury.

on the sidecurrency market The dollar reversed course and weakened sharply after market participants gradually eased concerns about the escalating conflict in the Middle East and expectations for a Federal Reserve interest rate cut increased again. This followed President Donald Trump's reiteration that the conflict in Iran was nearing its end. Overall, the Dollar Index (DXY) fell to around 98.8 points (the DXY index fluctuated between 98.7 and 99.4 points).

in part gold price Market participants' concerns about the escalating conflict in the Middle East have gradually eased, coupled with increasing expectations for interest rate cuts by the Federal Reserve and other major central banks, following President Donald Trump's statements suggesting a near-term end to the conflict in Iran. This has boosted gold prices (COMEX gold futures for April 2026 delivery), allowing them to rebound and fluctuate above the $5,100 per ounce zone once again.

For the next 24 hours

Market participants will be eagerly awaiting U.S. economic data reports, such as the NFIB Small Business Optimism Index for February, as well as weekly private sector employment figures by ADP, which may provide a glimpse into U.S. labor market trends, and existing home sales data.

In Asia, market players will be waiting to assess the outlook for the Chinese economy through the February exports and imports report, which may be affected by seasonal factors such as the Chinese New Year.

In addition to the factors mentioned above, market players will be monitoring developments in the highly uncertain conflict situation in the Middle East (making it advisable to use scenario analysis to assess financial market trends, as we analyzed each scenario in the previous week).