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Baht Extends Loss From Near 17-Month High on Intervention Risk

Jan. 24 (Bloomberg) -- Thailand’s baht extended its loss from close to a 17-month high after policy makers voiced concern about its appreciation, fueling speculation the central bank will intervene to halt gains that hurt overseas sales.

The baht stayed weaker for a fourth day after the government reported December export growth data that missed analysts’ estimates. Srirat Rastapana, director-general of the commerce ministry’s international trade department, said yesterday his office is “worried” the baht’s strength will affect shipments and doesn’t want it to rise further. Finance Minister Kittiratt Na-Ranong attributed the gains to short-term inflows and speculation.

“Officials are voicing concerns about the baht’s rise, and that’s keeping market participants nervous about possible intervention,” said Kozo Hasegawa, a foreign-exchange trader at Sumitomo Mitsui Banking Corp. in Bangkok. “There seems to be a correction from the recent appreciation. On top of that, the export data would have caused a bit of concern among investors.”

The baht traded at 29.80 per dollar as of 3:58 p.m. in Bangkok from 29.79 yesterday, according to data compiled by Bloomberg. It touched 29.66 on Jan. 21, the strongest level since August 2011. One-month implied volatility, a measure of expected moves in exchange rates used to price options, rose eight basis points, or 0.08 percentage point, to 4.4 percent.

Exports, which account for about two-thirds of Thailand’s economy, rose 13 percent in December after an increase of 27 percent the previous month, official data showed yesterday. The median forecast of economists in a Bloomberg survey was for a gain of 21.5 percent.

The yield on the 3.125 percent government bonds due December 2015 was little changed at 2.93 percent, data compiled by Bloomberg show.

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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