Bangkok: US President Donald Trump has reversed his decision to delay the increase in retaliatory tariffs, opting instead for a 90-day suspension of reciprocal tariffs for all countries except China. This move has led to significant gains in global markets, with stocks, gold, and oil experiencing substantial increases, and the Thai baht strengthening against the dollar.
According to Thai News Agency, the Thai stock market opened on a positive note, with the index climbing as much as 50 points, reaching a high of 1,138 points. This upward trend aligns with the overall positive opening of Asian stock markets. Additionally, crude oil and gold prices have risen, while the baht strengthened to 34.16-34.18 baht per dollar, compared to the previous day’s closing of 34.56 baht per dollar. Trump’s announcement, which excludes China from the tariff suspension, was a response to over 75 countries seeking negotiations with the US. In contrast, China has retaliated by increasing tariffs on US goods to 84% from 34%, prompting Trump to counter with a tariff hike on Chinese imports to 125% from 104%. At a Congressional Budget Dinner, Trump remarked that other nations are eager to negotiate, stating that they are “kissing my ass” for a trade deal.
Mr. Prakit Siriwattanaket, Managing Director of Merchant Partners Securities, commented that Trump’s decision was strategically sound, demonstrating his ability to manipulate markets. Despite Thailand facing an additional 10% tax affecting its GDP, a policy interest rate cut has helped maintain GDP growth at 2%. The SET Index is at a promising valuation point, with diminishing chances of falling below 1,000 points and potential recovery above 1,150 points. The Stock Exchange of Thailand’s measures have been crucial in supporting market stability.
Mr. Wathan Chitsomnuek, Senior Director of Strategy Analysis at Phatra Securities Co., Ltd., emphasized the need for caution, as Trump’s policy changes are unpredictable. Although the global stock market has improved following the tariff suspension announcement, the ongoing 104% US tax on China could perpetuate economic volatility. Despite Thailand’s ongoing economic challenges, investment opportunities exist in sectors like retail, commercial banking, and hospitality, which are less reliant on US exports. The SET index is expected to encounter resistance at 1,160 points and support at 1,100 points.
In the commodity markets, gold futures closed up nearly 3% in New York, with June delivery rising by $89.20 to $3,079.40 an ounce. The SPDR, the world’s largest gold fund, increased its holdings significantly. Additionally, crude oil prices rose, with West Texas Intermediate (WTI) for May delivery up by $2.77 to $62.35 a barrel, and Brent for June delivery up by $2.66 to $65.48 a barrel.
In Thailand, the Gold Traders Association reported price increases across five rounds, totaling an increase of 550 baht per baht of gold. The selling price for gold bars reached 50,400 baht, while gold ornaments sold for 51,200 baht.
Meanwhile, China’s National Bureau of Statistics reported a 0.1% decline in the consumer price index (CPI) for March, indicating continued deflation. The producer price index (PPI) fell by 2.5%, marking the largest decline since November 2014 and the 29th consecutive month of decrease.