Bangkok: The Thai baht strengthened, testing the 31.25 baht per dollar level this morning, compared to yesterday's closing level of 31.33 baht per dollar.
According to Thai News Agency, the Kasikorn Research Center stated that the Thai baht continued to appreciate, in line with the trend of most Asian currencies, while the US dollar weakened following the downward trend in US bond yields. This occurred after the US ISM manufacturing index fell to 47.9 in December 2025, marking the lowest level since October 2024 and falling short of market expectations of 48.4, as well as November 2025's figure of 48.2.
For today's trading range, the initial estimate is set at 31.20-31.45 baht per US dollar. Key factors to watch include foreign fund flows, movements of Asian currencies, global gold prices, signals regarding US interest rates from statements by Federal Reserve officials, and the December services PMI indices for the Eurozone, the UK, and the US.
Mr. Poon Panichpibul, Money and Capital Strategy Officer at Krungthai GLOBAL MARKETS, Krungthai Bank, revealed that the volatility of the Thai baht is at risk of increasing amidst uncertainty regarding the changing views of market players on interest rate trends from the Federal Reserve (Fed) and other major central banks. Political issues in the United States, including the potential for another government shutdown expected to reappear in early 2026, and the Supreme Court's consideration of import tariff measures, also warrant attention. He recommends that market players use options strategies or consider using local currencies to manage exchange rate risks more effectively. The baht is expected to trade within a range of 31.25-31.45 baht per dollar in the next 24 hours.
The US dollar weakened, coinciding with a decline in US 10-year bond yields, as market participants increased their expectations for a Federal Reserve interest rate cut following worse-than-expected ISM PMI manufacturing data. Furthermore, increased market risk appetite and a gradual easing of concerns over tensions between the US and Venezuela reduced demand for the dollar. The weaker dollar also supported gold prices, which remained volatile around $4,450 per ounce due to these factors.