Thailand’s baht emerged as the major gainer among a group of developing Asian currencies on Thursday, supported by the upbeat mood in the gold markets, while equities in Manila advanced ahead of an expected rate cut by the central bank.
Thailand is a major trading hub for gold and the metal’s advance over the past week amid concerns of a global trade war helped offset currency volatility fuelled by US President Donald Trump’s tariff plans.
The baht gained as much as 0.5% against the US dollar, while the Singapore dollar and its Taiwanese counterpart were mostly steady.
Poon Panichpibool, a market strategist at Krung Thai Bank, attributed the baht’s gain to the rise in gold prices and improving sentiment over the prospects of a peace deal in Ukraine.
The South Korean won and Malaysian ringgit added 0.3% and 0.1% respectively.
Overnight, data showed January US consumer inflation rose at its fastest pace in nearly 18 months, reinforcing the Federal Reserve’s message that it was in no hurry to resume easing rates.
“Currency markets are also waving risk-off flags – The US dollar has broken higher, moving above its 50-day moving average, suggesting higher levels ahead for the safe haven currency,” said Jessica Amir, market strategist at Moomoo Australia.
Thai baht/US dollar weaker on Tuesday
Equities rose in Asia trade on Thursday, as investors looked past the US inflation data and bet on an end to the war in Ukraine after Trump held separate phone calls with Russian President Vladimir Putin and Ukrainian President Volodymyr Zelenskiy.
Shares in Seoul added 0.8% while those in Taipei gained 0.2%.
The Malaysian benchmark index and the Indonesian stock market, meanwhile, lost 0.6% and 1% respectively.
The Philippine central bank is set to meet later in the day with markets expecting a 25-basis-point interest rate cut to bolster an economy that has missed its growth target for two straight years.
The Philippine peso was flat while equities in Manila gained 0.8%.
American Dollar Exchange Rate