Thai Baht Touches 1-Week Low Before Trade Data; Bonds Advance

Thailand’s baht reached a one-week low before data that is forecast to show exports dropped for a second straight month in July. Government bonds rose.

Overseas shipments fell 2.7 percent in July from a year earlier after a 4.24 percent slide the previous month, according to the median estimate of economists in a Bloomberg survey before a government report next week. Data on Aug. 14 showed euro-zone gross domestic product contracted 0.4 percent in the second quarter from a year earlier and industrial production dropped 2.1 percent in June from the prior year. Europe accounted for 8.7 percent of Thailand’s exports in the first half of this year, official data show.

“If you look at the economic data from the euro zone, they have been still sliding, and so we are still going to see some weakness in Asian exports in coming months,” said Nalin Chutchotitham, a Bangkok-based analyst at Kasikornbank Pcl. (KBANK)

The baht was little changed at 31.56 per dollar as of 3:52 p.m. in Bangkok after touching 31.59 earlier, the weakest level since Aug. 8, according to data compiled by Bloomberg. Its three-month implied volatility, a measure of exchange-rate swings used to price options, was little changed at 6.24 percent.

Government bonds snapped a two-day loss after data from the Thai Bond Market Association showed global funds boosted holdings of local debt by $152 million yesterday. The yield on the 3.25 percent bonds due June 2017 fell one basis point to 3.13 percent, according to data compiled by Bloomberg.

To contact the reporter on this story: Yumi Teso in Bangkok at yteso1@bloomberg.net

To contact the editor responsible for this story: James Regan at jregan19@bloomberg.net.

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