Thai Baht Declines on Speculation Importers Buying More Dollars

Thailand’s baht fell by the most in more than a week on speculation importers are stepping up dollar buying to take advantage of a more favorable exchange-rate. Government bonds rose.

The currency touched the strongest level in almost a month on June 18. Imports climbed 8 percent in May after an increase of 7.87 percent in April, while exports rose 0.65 percent following a 3.67 percent decline, according to the median estimates of economists surveyed by Bloomberg before official data next week. Global funds sold $61 million more Thai equities than they bought in the first two days of this week, taking net sales this month to $288 million, exchange data show.

“Imports have been growing at quite a fast pace, while exports aren’t recovering much,” said Hideki Hayashi, a researcher at the Japan Center for Economic Research in Tokyo. “Which means there’s more consistent demand for the dollar and other currencies.”

The baht dropped 0.3 percent, the most since June 8, to 31.49 per dollar as of 3:08 p.m. in Bangkok, according to data compiled by Bloomberg. The currency touched 31.33 on June 18, the strongest level since May 22. One-month implied volatility, a measure of exchange-rate swings used to price options, was unchanged at 4.52 percent.

The Bank of Thailand cut it export-growth forecast for this year to 8 percent from its earlier projection of 9 percent due to the deepening crisis in Europe, Songtham Pinto, director of the central bank’s office of macroeconomics, said yesterday. Governor Prasarn Trairatvorakul said today the bank is maintaining its 2012 economic growth prediction at 6 percent.

The yield on the 3.25 percent bonds due June 2017 declined two basis points, or 0.02 percentage point, to 3.32 percent, according to data compiled by Bloomberg. That was the lowest level since February.

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