Chinese Money Expected to Revive Thai Baht at Ringgit's Expense
- Investment, tourism from Asia’s biggest economy favor Thailand
- Baht among biggest February losers, when ringgit was resilient
The portrait of Thai King Maha Vajiralongkorn is displayed on a 1,000 banknote baht in an arranged photograph in Bangkok, Thailand, on Wednesday, Sept. 12, 2018.
Photographer: Brent Lewin/BloombergA tide of money from China is likely to lift the Thai baht back up after it went from first to one of the worst among Asia’s currencies.
The test case here is how it goes against Malaysia’s ringgit. While the baht dropped last month versus the ringgit by the most in almost two years, flows from China are likely to favor Thailand in the coming months. Bangkok is looking to China to help finance a 1.7 trillion baht ($54 billion) development plan, while Malaysia’s $20 billion rail project with China still hangs in the balance. Coupled with returning tourists, that boosts Thailand’s growth outlook just as Malaysia’s weak financial profile keeps investors on tenterhooks amid rising external uncertainties.