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USD/THB likely to trade in range of 32.5-33.0 at present, following a broader market tone: Scotiabank

The USD/THB is expected to trade in a range of 32.5-33.0 at present, following a broader market tone. Further the THB exchange rate will continue running a tight correlation with the DXY Index, according to the latest report from Scotiabank.

The difference between the United States and other economies’ rates will narrow amid continued monetary policy convergence going forward, which will likely see the U.S. dollar index retreating towards 92 then.

Further, given Thailand’s solid fundamentals including hefty current account surplus, the Thai Baht is expected to outperform regional peers amid escalating US-China trade war. The latest election progress could prop up the THB as well.

In addition, the Bank of Thailand (BoT) is expected to leave its policy rate unchanged at 1.50 percent at its monetary policy meeting scheduled to be held on September 19 with an accommodative monetary policy stance. The BoT’s real policy rate will turn positive as Thailand’s CPI inflation is bound to ease moderately starting from September on the back of favourable base effect, the report added.

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