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Asia’s Best-Performing Currency May Have More Room to Run

  • Baht ideal hedge due to its resilience to trade-war shocks
  • Swaps traders are reducing bets on BOT rate cut this week
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. The baht has been a stand-out currency amid the recent rout in emerging markets. It's appreciated 1.5 percent against the dollar so far this quarter, the best performer among major Asian currencies and the only gainer among them.
Photographer: Brent Lewin/Bloomberg
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The Thai baht has been the runaway success among Asian currencies this year -- surging more than 6% while the U.S.-China trade war has punished peers such as the South Korean won and Chinese yuan. There are two reasons why it may rise even more.