Baht Gains for Second Day on Current-Account Surplus, Inflows

Thailand’s baht rose for a second day after the nation posted its first monthly current-account surplus since March. Government bonds declined.

Southeast Asia’s second-largest economy posted a $1.3 billion excess in the broadest measure of trade in August, more than the median forecast in a Bloomberg survey for a $653 million surplus, central bank data showed yesterday. Inflation slowed to an almost four-year low of 1.4 percent in September, the Commerce Ministry said today. Asian currencies rose as the shutdown of the U.S. government reduced demand for the dollar.

“The fact that the current-account balance was turning to surplus and the excess was bigger than expected was supportive for the baht and encourages some fund inflows,” said Tohru Nishihama, an economist covering emerging markets at Dai-ichi Life Research Institute Inc. in Tokyo.

The baht strengthened 0.5 percent, the most since Sept. 19, to 31.16 per dollar as of 4 p.m. in Bangkok, after gaining 2.7 percent last month, according to data compiled by Bloomberg. One-month implied volatility, a measure of expected swings in the exchange rate used to price options, climbed 32 basis points, or 0.32 percentage point, to 7.74 percent.

Global funds bought $3.1 billion more Thai bonds than they sold in September and pumped a net $300 million into stocks, official data show, contributing to the currency’s biggest monthly advance since July 2011.

The U.S. government began its first shutdown in 17 years today amid a deadlock in Congress over government spending plans and President Barack Obama’s health-care law.

The yield on the 3.625 percent bonds due June 2023 rose one basis point to 3.94 percent, data compiled by Bloomberg show.

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