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Business Times
5 days ago
- Business
- Business Times
Baht falls from highest since 2022 on conflict with Cambodia
[BANGKOK] Thailand's baht fell after touching the highest in more than three years on the escalating conflict with its neighbour Cambodia. The local currency fell 0.3 per cent to 32.29 per US dollar on Thursday (Jul 24) after touching 32.11 earlier, the strongest since February 2022. Stocks slid about 1 per cent. The baht had surged more than 6 per cent this year on growing optimism over trade negotiations, the return of foreign stock inflows and near-record high gold prices. Thai fighter jets hit two Cambodian army posts near their disputed border on Thursday, as troops clashed in multiple locations in an escalation of tensions between the two nations. 'The escalating border conflict is giving investors a reason to book some gains after the Thai baht has appreciated,' said Lloyd Chan, currency strategist at MUFG Bank. The conflict could put a pause in baht's rally this year. Sentiment was boosted earlier after Finance Minister Pichai Chunhavajira said on Tuesday the nation is close to an agreement with the US to lower a threatened 36 per cent tariff on its goods ahead of the Aug 1 deadline, and expects a rate closer in line with regional neighbours. A NEWSLETTER FOR YOU Friday, 8.30 am Asean Business Business insights centering on South-east Asia's fast-growing economies. Sign Up Sign Up The baht's gain is putting pressure on authorities to curb its strength to protect the nation's economic drivers of tourism and exports. 'Bank of Thailand will continue to watch for any excessive volatility,' said Christopher Wong, senior foreign-exchange strategist at OCBC in Singapore. A break of the resistance level at 32 to 32.1 baht per US dollar may add more tailwind to the currency, he said. Thailand's foreign-exchange reserves climbed to a record US$263 billion earlier in July, partly as officials stepped up their intervention to slow the baht's appreciation. Easing tensions between two of Thailand's largest trade partners – the US and China – are also soothing investor worries. Global funds have poured a net US$345 million into Thai equities in July, on track for the first monthly inflow in 10 months. On Wednesday alone, global funds poured in US$139 million into stocks, the largest single-day inflow in 10 months. The baht is also underpinned by near-record high gold prices, given the country's status as a major trading hub for the precious metal in Asia. BLOOMBERG
Bangkok Post
5 days ago
- Business
- Bangkok Post
Baht falls from highest since 2022 on conflict with Cambodia
Thailand's baht fell after touching the highest in more than three years on the escalating conflict with its neighbor Cambodia. The local currency fell 0.3% to 32.29 per US dollar on Thursday after touching 32.11 earlier, the strongest since February 2022. The Stock Exchange of Thailand (SET) index slid about 1%. The baht had surged more than 6% this year on growing optimism over trade negotiations, the return of foreign stock inflows and near-record high gold prices. Thai fighter jets hit two Cambodian army posts near their disputed border on Thursday, as troops clashed in multiple locations in an escalation of tensions between the two nations. 'The escalating border conflict is giving investors a reason to book some gains after the Thai baht has appreciated,' said Lloyd Chan, currency strategist at MUFG Bank. The conflict could put a pause in baht's rally this year. Sentiment was boosted earlier after Finance Minister Pichai Chunhavajira said on Tuesday the nation is close to an agreement with the US to lower a threatened 36% tariff on its goods ahead of the Aug 1 deadline and expects a rate closer in line with regional neighbours. The baht's gain is putting pressure on authorities to curb its strength to protect the nation's economic drivers of tourism and exports. 'Bank of Thailand will continue to watch for any excessive volatility,' said Christopher Wong, senior foreign-exchange strategist at Oversea-Chinese Banking Corporation in Singapore. A break of the resistance level at 32 to 32.1 baht per dollar may add more tailwind to the currency, he said. Thailand's foreign-exchange reserves climbed to a record $263 billion earlier in July, partly as officials stepped up their intervention to slow the baht's appreciation. Easing tensions between two of Thailand's largest trade partners — the United States and China — are also soothing investor worries. Global funds have poured a net $345 million into Thai equities in July, on track for the first monthly inflow in 10 months. On Wednesday alone, global funds poured in $139 million into stocks, the largest single-day inflow in 10 months. The baht is also underpinned by near-record high gold prices, given the country's status as a major trading hub for the precious metal in Asia.
The Star
18-07-2025
- Business
- The Star
Asian shares head for best week in months on trade deal hopes; currencies fall
Stock markets in emerging Asia were headed for their best week in several months on Friday, driven by optimism around trade deals with the United States, and an increasingly dovish tilt at regional central banks. The MSCI gauge of emerging Asia stocks touched its highest in more than three years and was set to end the week 1.6% higher. Stocks in Taiwan, which make up over a fifth of the index, rose 1% to a more than four-month high. TSMC, the world's largest contract chipmaker, rallied more than 2% after posting a record quarterly profit on Thursday. An MSCI index of ASEAN equities, dominated by Singapore, surged to a more than nine-month high. Singapore's stocks touched a record high for the tenth straight day, which also marks its longest ever rally. Indonesian equities jumped more than 1% to an over seven-month peak, led by data centre service provider DCI Indonesia, which surged over 16% to a record high, and Barito Renewables Energy, which gained about 8%. A trade deal with the U.S. at a lower than previously announced tariff rate, alongside an increasingly dovish stance by the central bank, has helped drive inflows into equities. Domestic investors have net bought 6.21 trillion rupiah ($380.86 million) so far this month, as per exchange data. In Thailand, the benchmark index rose 1%. It has surged almost 7% for the week and was set for its biggest gain since June 2020, driven by inflows on news of the government proposing a new central bank chief with a dovish bias. Elsewhere, Malaysian stocks jumped 0.4%, while those in the Philippines ticked marginally higher. India's Nifty 50 slipped 0.7% to a more than three-week low. Currencies in the region were mixed. Indonesia's rupiah, the Philippine peso, Thai baht, and Singapore's dollar advanced modestly against the U.S. dollar, while Malaysia's ringgit and the Indian rupee slipped. Asian currencies have lost some ground over the past few sessions as the dollar index recovered from a more than two-year low hit earlier this month. "Asian currencies have come under pressure amid an incipient rebound in the U.S. dollar, driven by renewed market focus on tariffs," MUFG senior currency analyst Lloyd Chan said. "And while markets still hold net short positions on the U.S. dollar, some unwinding of those trades could lend support for the recent U.S. dollar rebound." HIGHLIGHTS: ** Indonesia's 10-year benchmark yield slips to 6.558% ** Indonesia still negotiating tariff details ** Malaysia's economy likely grew 4.5% y/y in Q2 ** Singapore's exports rise 13% annually in June - Reuters
New Straits Times
04-07-2025
- Business
- New Straits Times
Asian stocks retreat from recent peaks as US tariff deadline looms
SINGAPORE/HONG KONG: Stocks in emerging Asian economies pulled back on Friday from recent peaks, as market participants took a cautious stance ahead of US President Donald Trump's July 9 tariff deadline, while regional currencies dipped against a steady US dollar. An MSCI gauge of equities in emerging Asia slid nearly 1 per cent from a 3-1/2-year high notched in the previous session. Stocks in South Korea and Taiwan, which together make up over a third of the regional index, were the biggest drags on performance. Investors initially cheered trade discussions between the United States and Vietnam, hoping they could pave the way for breakthroughs in other emerging economies. But limited details and tariffs remaining above pre-April 2 levels dampened the optimism. "The trade deal with Vietnam announced this week was more hawkish than we expected, posing a risk that other countries could face higher tariff rates," Nomura analysts said in a note. South Korea's KOSPI fell 1.5 per cent after scaling a near four-year high in the previous session, marking its worst intraday drop since April 9. Taiwan's benchmark index slipped from a near four-month high. Stocks in the Philippines fell 0.7 per cent, while those in Singapore eased off from a record-closing high. Thai stocks also came off a three-week peak, snapping a four-session rally. Vietnam's benchmark index slipped from its April 2022 peak, while the dong weakened to a record low of 26,230 against the US dollar. Currencies in emerging Asia also nudged lower - Malaysia's ringgit slipped to an eight-session low, while the Indonesian rupiah and the Philippine peso shed around 0.2 per cent each. An index tracking global emerging market currencies retreated from a record high. "Asian currencies may face renewed volatility as markets turn their attention to tariff-related developments," said Lloyd Chan, senior currency analyst at MUFG. Citi analysts, referring to the US-Vietnam trade development, said that while the "de-dollarisation" narrative remained well-entrenched and had more steam to run further, "the roadblocks for stronger EM Asia FX had just increased". They predicted similar deals could impact currencies such as the Chinese yuan, ringgit, Thai baht, South Korea's won, and the Singapore dollar. On the day, the Singaporean dollar snapped a three-day losing streak to appreciate marginally, and remained a few points shy of its October 2014 high. The Thai baht and the Indian rupee weakened marginally. The US dollar index, which measures the greenback against a basket of major currencies, retraced some of its gains from Thursday.
The Star
01-07-2025
- Business
- The Star
Ringgit rises to nine-month high on bond inflows, weaker dollar
Malaysia's ringgit advanced to the strongest level in nine months against the dollar, buoyed by foreign bond inflows and a broad weakness in the US currency. The ringgit climbed as much as 0.7% to 4.1805 per greenback, a level last seen in October. The currency has rallied in recent weeks amid signs the global trade war is easing, boosting sentiment for the export-dependent economy. Meanwhile, global funds poured $2.9 billion into Malaysia's bonds in May, according to Bank Negara Malaysia's latest data, the largest monthly inflow since October 2013. "We expect the ringgit to find support from a weaker dollar,' said Lloyd Chan, FX strategist at MUFG Bank Ltd. "Ringgit bonds have also been in high demand, supporting increased foreign participation in the local government bond market.' MUFG forecasted the ringgit to rise to 4.11 per dollar by end-2025, he added. Gains in the nation's assets have been driven by signs that trade agreements with as many as a dozen of America's largest trading partners are expected to be completed by the July 9 deadline. A trade truce between the US and China, the top two destinations for Malaysian exports according to 2024 data from the International Monetary Fund, has also lifted optimism. An index of dollar strength fell over 2% in June, its sixth straight decline, on bets of Federal Reserve interest rate cuts and concerns over the widening US fiscal deficit. - Bloomberg
