The baht has depreciated against the dollar, prompting concerns about Thailand’s currency and economy. Market factors, interest rates, capital outflows, and budget delays all contribute to the baht’s instability.
The Baht’s Recent Depreciation
The sharp decline in the value of the baht in recent weeks has sparked discussions about its short-term future. The baht has dipped below 37 to the dollar, marking a six-month low. In comparison with other Asian currencies, the Japanese yen has experienced the most significant drop, falling by 10.5 per cent this year, followed by the baht at 7-8 per cent.
Factors Affecting the Baht
The baht’s slide against the dollar is part of a wider regional trend driven by concerns that the US Federal Reserve may extend high-interest rates. Experts like Piti Disyatat believe that the baht’s weakening may be offset by rising exports due to cheaper goods. However, challenges like delayed budget disbursement and concerns about rising government debt could affect the baht’s value and overall economic performance in Thailand.
