Currency depreciation accelerates due to U.S. election results, economic interventions, and volatile commodity markets.

The Thai Baht has dropped 7% since late September, reversing its earlier growth in 2024. The downturn is expected to continue, driven by external and domestic factors.

1. Trump’s Election Win

By late September, Donald Trump’s likely victory in the U.S. election became evident, sparking concerns about new tariffs on exports. This uncertainty pushed investors towards safer currencies, strengthening the U.S. dollar while weakening the Baht.

2. Central Bank Measures

The Bank of Thailand stepped in after the Baht’s significant appreciation between July and September. Officials aimed to curb its strength, worried it might harm tourism and exports during the upcoming high season.

3. Impact of Commodities

Shifts in gold and oil prices have added pressure on the Baht. Anticipated changes in global policies, economic forecasts, and ongoing conflicts in the Middle East have created instability.

Future Outlook

The Thai Baht will likely weaken further against the U.S. dollar. The Asian Development Bank (ADB) recently lowered Thailand’s growth forecast, citing reduced government spending and slower exports.

Justin Grossbard from CompareForexBrokers agrees with the ADB’s view but emphasizes complexities in the Baht’s performance. While the U.S. dollar strengthens across Asia and Europe, the Baht may gain against currencies like the Euro (EUR), Australian Dollar (AUD), and Singapore Dollar (SGD). For instance, the AUD has fallen 10% against the Baht in recent months, affecting Thailand’s tourism and exports.

Available Options

For those holding large amounts of Baht and concerned about further depreciation:

• Convert to USD: Services like Wise.com allow users to transfer Thai Baht to U.S. dollars and hold funds in low-fee accounts.
• Invest in Commodities: Gold could be an option, though its value has declined in November, adding potential risks.

While the Baht may weaken further against the U.S. dollar, it is likely to remain stable against other currencies.