Krungsri (Bank of Ayudhya PCL), through its Global Markets Group, analysed the baht's direction for this week, projecting a trading range of 32.00-32.75 to the US$.
This follows a week in which the baht closed stronger at 32.19/US$, after trading within the 32.17-32.80 range.
The US dollar weakened against most major currencies as crude oil prices dropped significantly. This reflected investor optimism regarding a potential deal between the US and Iran to end their conflict and reopen the Strait of Hormuz.
Iranian media, meanwhile, signalled that parts of the US proposal do not align with the views of Iran’s leadership.
Moreover, there were reports indicating that Chinese Foreign Minister Wang Yi has urged Iran to continue negotiations with the US.
By the end of last week, skirmishes between the US and Iran in the Strait of Hormuz renewed concerns over a rebound in oil prices, despite US assurances that the ceasefire remains in effect.
Meanwhile, foreign investors sold 2.035 billion baht in Thai shares, but purchased 13.638 billion baht in bonds.
According to Krungsri Global Markets, the market is now pivoting toward US inflation data to gauge the Federal Reserve's next interest rate moves, especially following stronger-than-expected April employment figures.
Hopes for peace in the Middle East remain fragile.
Most recently, US President Donald Trump described Iran’s response to the US de-escalation proposal as "completely unacceptable."
Under these conditions, global oil prices are expected to remain a key driver for short-term exchange rate movements.
Domestically, Thailand's headline Consumer Price Index (CPI) for April rose 2.89% year-on-year, the highest increase in over three years, driven by surging energy prices. This marks the first time inflation has turned positive since March 2025. Core CPI (excluding energy and fresh food) rose by 0.83%.
For the full year 2026, the Ministry of Commerce expects inflation to sit between 1.5% and 2.5%, which remains within the Monetary Policy Committee's target range.
Vitai Ratanakorn, governor of the Bank of Thailand, stated that the Thai economy is projected to grow by 2.1% this year, up from the previous estimate of 1.5%, and is expected to accelerate to 2.6% in 2027, supported in part by the 400-billion-baht emergency loan decree.
