Thai Baht: Pressured by record deficit against US Dollar – Commerzbank

💡 DMK Insight

USD/THB’s drop to 32.55 amid a record trade deficit is a red flag for traders. The recent portfolio inflows suggest that foreign investment is still bullish on Thailand, but the widening trade deficit indicates underlying economic weaknesses. A trade deficit of USD10.0bn in April raises concerns about the sustainability of the Thai economy and could lead to volatility in the THB. Traders should watch for potential resistance levels around 32.80 and support near 32.30. If the trade deficit continues to grow, we might see a shift in sentiment, potentially leading to a stronger USD against the THB. On the flip side, if portfolio inflows persist, it could provide temporary support for the THB. However, the key takeaway is that the trade balance is a crucial indicator to monitor. Keep an eye on upcoming economic reports and any shifts in investor sentiment, especially from institutional players who might react strongly to these developments.