What To Know
- The baht rallies to its strongest level in almost five years as gold hits records and the US dollar weakensImage Credit.
- Investors remain concerned about policy direction under President Donald Trump, particularly regarding the selection of the next Federal Reserve chair and the risk of a potential US government shutdown later this month.
Bangkok Business News: Baht Breaks Key Psychological Level
The Thai baht surged past the critical 31.00 level against the US dollar, strengthening to 30.866 before easing slightly, marking its strongest level in nearly five years. The move represented the firmest exchange rate since March 2021 and highlighted intensifying pressure on the US dollar amid shifting global financial sentiment. After touching the intraday high, the baht moderated to trade around 30.90–30.92, still significantly stronger than the previous session’s close of 31.05.
Image Credit: AI-Generated
Dollar Weakness and Gold Fuel the Rally
The appreciation was driven by broad-based US dollar selling, record-high gold prices, and renewed strength in key Asian currencies. As investors rotated away from the greenback, demand rose for regional currencies seen as more resilient in the current environment. This Bangkok Business News report observes that sentiment turned sharply in favour of Asian assets as traders reassessed risk and monetary policy trajectories. Gold prices hitting fresh all-time highs further supported the baht, reflecting Thailand’s close links to gold trading flows.
Asian Currencies Gain Momentum
Strength in the Japanese yen and Chinese yuan also reinforced the baht’s upward move. The yen continued to appreciate amid expectations of policy normalization in Japan, while the yuan benefited from signs of stabilization in China’s economic outlook. Together, these gains underscored a broader regional shift as investors reduced exposure to the US dollar and sought alternatives across Asia.
US Policy Uncertainty Weighs on Markets
Uncertainty surrounding US economic and monetary policy has added to dollar pressure. Investors remain concerned about policy direction under President Donald Trump, particularly regarding the selection of the next Federal Reserve chair and the risk of a potential US government shutdown later this month. These factors have increased volatility and undermined confidence in the greenback.
Outlook and Key Levels to Watch
Markets Strategist at Krungthai GLOBAL MARKETS, said the baht has broken below the 31.00 support zone again and is now trading within a 30.89–31.13 range. For January 28, 2026, the baht is expected to move between 30.80 and 31.05 per dollar, with markets closely watching signals from the Federal Reserve meeting, movements in the yen and global gold prices, and foreign investor fund flows.
Most Bangkok businesses, exporters and tourist related businesses are worried that the strong baht is going to cause more issues and difficulties.
While analysts caution that short-term gains could be capped if US uncertainty persists or if major trading partners intervene, continued dollar weakness may allow the baht to test the 30.80 level, reinforcing Thailand’s currency strength amid an increasingly fragile global backdrop.
For the latest on the Thai economy, keep on logging to Bangkok Business News.
