Baht Rallies Most in Two Weeks After Bangkok Blockades Removed

Thailand’s baht rose the most in two weeks as stocks climbed after anti-government protesters removed blockades at four main intersections in central Bangkok.

The SET Index of shares advanced 1.8 percent this week to a two-month high as demonstrators relocated to Lumpini Park in the capital. The Bloomberg-JPMorgan Asia Dollar Index rose on a report that Russian President Vladimir Putin had ended military exercises as scheduled, reducing concern tension in Ukraine will escalate into full-blown conflict.

The baht strengthened 0.3 percent, the most since Feb. 14, to 32.47 per dollar as of 3:38 p.m. in Bangkok, according to data compiled by Bloomberg. One-month implied volatility, a measure of expected moves in the exchange rate used to price options, increased 11 basis points, or 0.11 percentage point, to 6.53 percent.

“Equities are doing well and so the baht is reflecting a bit more optimism from the removal of blockades in central Bangkok,” said Sacha Tihanyi, a Hong Kong-based currency strategist at Scotiabank. Risk sentiment was “helped by the news that Russia has ended its recent military exercises,” he said.

Two-year government bonds advanced for a sixth day. The yield on the 3.125 percent notes due December 2015 fell two basis points to 2.25 percent, data compiled by Bloomberg show. That is the lowest since the securities were sold in 2010.

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