FxWirePro- Crypto Weekly Alpha: ETF Rebounds, L2 Rallies & Key Resistance Levels 
Trump’s "Shock and Awe" Agenda: Executive Orders from Day One 
Big AI wants to slow down AI research. Is it a safety pause or a strategic retreat? 
China's Refining Industry Faces Major Shakeup Amid Challenges 
European Stocks Rally on Chinese Growth and Mining Merger Speculation 
Wall Street Analysts Weigh in on Latest NFP Data 
U.S. Treasury Yields Expected to Decline Amid Cooling Economic Pressures 
Fed May Resume Rate Hikes: BofA Analysts Outline Key Scenarios 
US Futures Rise as Investors Eye Earnings, Inflation Data, and Wildfire Impacts 
Stock Futures Dip as Investors Await Key Payrolls Data 
China’s Growth Faces Structural Challenges Amid Doubts Over Data 
Moldova Criticizes Russia Amid Transdniestria Energy Crisis 
US Gas Market Poised for Supercycle: Bernstein Analysts 
Add as a preferred source on Google
Thai currency has been continually outperforming among EM Asia FX space, consolidation by 8% this year and outperformance should continue over the coming months on large current account balance, foreign inflows, stable growth, and neutral valuations. We roll our short positions in USDTHB position via 3m NDF – initiated in early earlier this month on structural current account improvement, neutral valuations.
The upward march in the merchandise trade and services balance has resulted in Thailand having the second-largest surplus in EM relative to GDP (10.6% of the GDP over last four quarters) and the fourth-highest in dollar terms. Despite the THB being the top performing currency in the region year-to-date, the REER is only 3% higher than its 10-year average.
FX reserves have increased by $23bn since the start of the year, and more steeply since July (by $10bn) on possible dollar buying from BoT. However, a less aggressive approach can be adopted by the BoT if EM currencies continue to strengthen (EM Special – Still believers in the EM FX carry trade). The BoT recently talked about measures to monitor large transitions but any policy shifts would be directed at slowing, rather than reversing, the direction of the THB.
Thus, stay short in USDTHB via 3m forwards. The position has been rolled over with the following parameters: Sell USDTHB via 3m DF at 33.130 (spot reference) with the target at 32.10 (3.10%) and stop at 33.45 (-1%). The trade horizon is 2-3 months and it has a negative carry of 6bp/month.
