Thai Baht, Bonds Decline This Week on U.S. Data, Syria Tensions

Thailand’s baht fell for a fourth week, the longest losing streak in three months, and bonds dropped before U.S. jobs data that may influence expectations for when the Federal Reserve will rein in stimulus.

The baht declined to a three-year low before the report that may show U.S. employers added 180,000 jobs in August after an increase of 162,000 the previous month, according to the median forecast in a Bloomberg survey of economists. Global investors sold $31 million more Thai equities than they bought this week through yesterday, exchange data show, amid concern the U.S. is moving closer to a military strike against Syria.

“The biggest focus in the market now is the U.S. employment data to assess the outlook for the Fed’s reduction in stimulus,” said Hideki Hayashi, a researcher at the Japan Center for Economic Research in Tokyo. “Emerging-market currencies and assets are under downward pressure and such severe conditions will probably continue for a while. Syria tensions are adding to weak sentiment.”

The baht lost 0.7 percent during the five days and 0.2 percent today to 32.38 per dollar as of 3:29 p.m. in Bangkok, according to data compiled by Bloomberg. The currency touched 32.48 earlier, the weakest level since July 2010.

One-month implied volatility, a measure of expected moves in the exchange rate used to price options, climbed 42 basis points, or 0.42 percentage point, to 7.63 percent this week. The gauge increased 10 basis points today.

The Fed will start to slow its $85 billion a month of bond purchases at its Sept. 17-18 meeting, according to 65 percent of economists surveyed by Bloomberg last month. The U.S. Senate Foreign Relations Committee voted 10-7 this week in favor of a resolution authorizing limited action against Syria.

The yield on Thailand’s 3.625 percent sovereign bonds due June 2023 rose nine basis points from a week ago and one basis point today to 4.4 percent, data compiled by Bloomberg show. That is the highest level for a benchmark 10-year note since November 2009.

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