Federal Reserve (FED) · Thai Examiner
Weakening baht falls below 33 to the US dollar as industry leaders warn borrowing costs will also rise
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Thailand’s baht has crashed through the ฿33 barrier as markets bet on more US rate hikes, capital flees to the dollar and current account deficits return. Industry leaders warn borrowing costs may rise while analysts see further pain ahead for the cu
Key facts
- Thailand’s baht has crashed through the ฿33 barrier as markets bet on more US rate hikes, capital flees to the dollar and current account deficits return
- Gold prices fell 1.6% to US$4,118 an ounce
- Fed funds futures now imply a 54% probability of two additional 25-basis-point rate increases before the end of 2026
- On October 14, 2022, the currency fell to ฿38.25 against the dollar
- The Thai baht has slipped to its weakest level this year, breaking through the ฿33 mark against the US dollar as investors increasingly wager on higher American interest rates before year-end
- The currency closed at ฿33.21 on Tuesday before weakening further to ฿33.38 on Wednesday
Summary
Thailand’s weakening baht has become a fresh warning signal for the economy, falling to its lowest level this year as markets bet on further US rate hikes, current account deficits return, capital flows head overseas and geopolitical tensions drive investors into the dollar.
The Thai baht has slipped to its weakest level this year, breaking through the ฿33 mark against the US dollar as investors increasingly wager on higher American interest rates before year-end. The currency closed at ฿33.21 on Tuesday before weakening further to ฿33.38 on Wednesday. As a result, attention has shifted from the Federal Reserve’s recent pause to the prospect of renewed monetary tightening in the United States.