The value of the baht opened this morning at 33.17 baht/dollar.
The Thai baht opened this morning at 33.17 baht per dollar, remaining stable and unchanged from the previous day's closing level.
September 1, 2569 – Mr. Poon Panichpibul, Money and Capital Strategy Officer at Krungthai GLOBAL MARKETS, Krungthai Bank, revealed that the Thai baht opened this morning at 33.17 baht per dollar, remaining stable and unchanged from the previous day's closing level.
Since overnight, the Thai baht (USDTHB) has moved sideways without a clear direction (fluctuating between 33.12-33.21 baht per dollar). Although the baht faced some pressure due to the strengthening of the dollar and the initial decline in gold prices (XAUUSD) in the US market, it eventually strengthened slightly after the dollar weakened a bit.
Gold prices rebounded to the $4,450 per ounce zone, mirroring developments in the Middle East. While tensions have flared up again, the exchange of attacks between the US and Iran has not escalated significantly, and there's no indication that either side will escalate the violence. Furthermore, the dollar faced some pressure as some market participants gradually sold off their positions to take profits ahead of key US economic data, such as labor market data, throughout the week.
Regarding the trends in the Thai baht (USDTHB) exchange rate.
We maintain our view that the Thai baht faces two-way risk in the short term, depending on changes in market players' views on the Federal Reserve's monetary policy outlook. This will depend on developments in US economic data and the highly uncertain situation in the Middle East. Therefore, market players should employ a more diversified hedging strategy, especially options strategies, which can significantly enhance currency risk management in this highly uncertain market environment.
During the day, we expect the Thai baht to remain in a sideways range, with resistance around 33.20-33.30 baht per dollar and support around 33.00-33.10 baht per dollar (with the next support level at 32.85 baht per dollar). This is because market participants may be waiting to monitor and anticipate key US economic data, which could cause market participants to adjust their views on the Federal Reserve's interest rate outlook.
However, developments in the Middle East will remain a key factor impacting overall financial markets. If the situation escalates, potentially leading to more severe and widespread retaliatory attacks between the US and Iran, we believe crude oil prices risk continuing to rise. This would further pressure the Thai baht to weaken, driven by increased likelihood of interest rate hikes by major central banks, particularly the FED, strengthening the US dollar and potentially pushing gold prices lower.
Furthermore, we believe caution is advised regarding volatility as the market gradually absorbs the results of the 10-year Japanese bond auction, expected around 10:35 AM Thailand time. Potential selling pressure on the 10-year Japanese bonds, if the auction results are unfavorable, could put downward pressure on the overall bond market, potentially leading to higher long-term global bond yields and further volatility in equity and currency markets through fluctuations in the Japanese yen (JPY).
Technically, using a trend-following strategy, the Thai baht remains in an "upward" trend. However, if the baht reverses and weakens, clearly breaking through the resistance zone of 33.50 baht per dollar, it will return to a "downward" trend on the weekly timeframe. (The baht has already returned to a downward trend on the daily timeframe after weakening through the 33.00 baht per dollar zone.)
Looking at the baht's range in the 24 hours, it is expected to be at 33.05-33.30 baht/dollar.
Other market views
Despite the overall pressure on financial markets from the escalating situation in the Middle East, US stock markets received some support from gains in AI/Semiconductor themed stocks, led by Micron (+2.8%) and Nvidia (+1.5%). In addition, rising energy prices amidst uncertainty in the Middle East boosted energy stocks such as Exxon Mobil (+2.7%). As a result, the Dow Jones fell -0.70%, the S&P 500 closed -0.33%, and the Nasdaq Composite declined -0.12%.
On the European stock market side , the STOXX 600 index fell by more than -0.62% amid concerns over the situation in the Middle East and the ongoing Russo-Ukraine conflict. However, a rise in energy prices driven by geopolitical concerns boosted energy stocks and helped to stabilize European stock markets somewhat.
In the bond market, the 10-year US Treasury yield has been gradually rising closer to the 4.78% zone following renewed tensions in the Middle East, which have fueled increases in energy prices. This has raised concerns about inflation prospects among market participants, leading them to maintain a 51% chance that the Federal Reserve (FED) will raise interest rates twice this year, even as the 10-year US Treasury yield approaches the 4.80% zone.
However, we maintain our previous recommendation that market players can gradually purchase long-term US (and Thai) bonds, especially if the 10-year US bond yield rises above 4.70%. This is because we maintain our view that the FED is likely to keep interest rates unchanged in 2026 before gradually cutting them twice in 2027 (Q2 and Q4). The Bank of Thailand (BOT) may keep interest rates unchanged throughout this year and next. Furthermore, if the FED does proceed with interest rate hikes, as the market expects, which might involve 2-3 increases this year, we would also consider other possibilities.
We believe that the FED's interest rate hike will eventually pave the way for long-term bond yields to gradually decline, as the economic outlook and inflation trends may slow down. Furthermore, the FED has a chance to cut interest rates somewhat next year, making a gradual purchase of long-term US bonds using a "buy on dip" strategy still attractive.
In the currency market , the dollar weakened slightly due to profit-taking and adjustments in position holdings by some market players ahead of the release of US labor market data. Furthermore, developments in the Middle East did not escalate significantly. Overall, the dollar index (DXY) declined to the 99.4 point zone (the DXY index fluctuated around 99.3-99.6 points).
Regarding gold prices, concerns over the situation in the Middle East and the prospect of further interest rate hikes by major central banks continue to put pressure on gold prices (COMEX gold futures for December 2026 delivery). However, gold prices are still receiving some support from buy-on-dip buying and some dips in the dollar, allowing prices to fluctuate around $4,500 per ounce.
For the next 24 hours
Market participants are awaiting the release of the US ISM PMI manufacturing index for August, particularly the price index, which may reflect US inflation trends. They are also anticipating the July JOLTS job openings report. Simultaneously, market participants will be monitoring statements from Federal Reserve officials to assess the Fed's monetary policy direction.
On the European side, market players are awaiting the Eurozone's August CPI inflation report, a key factor influencing the European Central Bank's (ECB) monetary policy outlook. Currently, market participants believe the ECB has around a 78% chance of raising interest rates two more times this year.
In Asia, market players will be awaiting to assess the outlook for the Chinese economy through the RatingDog manufacturing PMI report for August, while also monitoring the results of Japan's 10-year government bond auction, which could impact the bond market and the overall financial market.
On the Thai side, market participants are eagerly awaiting the August Business Sentiment report.
In addition to the factors mentioned above, market players will be closely monitoring developments in the Middle East following the resurgence of tensions. Simultaneously, market participants will be watching for movements in AI/Semiconductor themed stocks, which could create volatility in financial markets.
Read all the news about finance-exchange rates-gold prices-oil prices here.
