The baht opened at 34.29 to the US dollar on Friday, dropping from Thursday’s close of 34.05.
The currency is expected to move in a range between 34.20 and 34.40 on Thursday, according to Krungthai Bank market strategist Poon Panichpibool.
Volatility in the currency market is still supporting the dollar and pressuring the baht, Poon added. Meanwhile, the Covid-19 situation in China is deterring investment in Asian emerging markets, meaning the baht is likely to swing sideways, he said.
However, the baht would face downward pressure from purchases of gold if the price goes down. Poon said the Thai currency’s key resistance level would be 34.50, at which point exporters would sell the dollar.
He advised businesses to use hedging tools such as options to manage risks in the highly volatile currency market.
The Bank of Thailand (BOT) is expected to maintain its key policy interest rate despite the high domestic inflation, Krungthai Bank’s market analyst, Poon Panichpibool, said on Thursday.
He said the high inflation rate would not pressure the BOT to raise the interest rate even though many other central banks had done so.
It is because the price increases in Thailand have affected only a limited number of goods, he explained.
In April, the increase in Thailand’s general inflation slowed down from the first months of the year. The prices of energy products are stabilising although most food items have seen price increases, he noted.
Poon, a strategist on capital and monetary markets at the state-run commercial bank, expected the Thai baht to continue depreciating due to factors like the ongoing Russia-Ukraine war.
The US Federal Reserve Bank (Fed) recently resolved to raise its policy interest rate by 0.50 per cent, as expected earlier. However, Fed chairman Jerome Powell gave no signs there would be a further increase in the policy interest rate, as was the concern in the markets previously.
Thailand will host a meeting of Apec Ministers Responsible for Trade (MRT) from May 19 to 22 to push for the digital economy and post-Covid economic revival among several goals, a senior Commerce Ministry official said on Thursday.
Oramon Sapthaweetham, director-general of the Department of Trade Negotiations (DTN), said Deputy Prime Minister and Commerce Minister Jurin Laksanawisit will chair the Asia-Pacific Economic Cooperation MRT meeting.
The meeting will discuss several issues, including the push for Bio-Circular-Green Model economy, cooperation to ease trade and investment restrictions, tourism promotion, free trade agreements, and the push for implementation of a digital economy and society, Oramon said.
During the meeting, ministers of the member nations will also discuss cooperation for sustainability in food production and “new normal” trade that will be suitable for the post-Covid era, she added.
The member nations will be asked to help support access to vaccines and necessary goods, she said.
In another development, Oramon announced the five-year (2022-2027) vision to mark the DTN’s 80th anniversary this year.
Among other things, the DTN will push for more FTA agreements to cover up to 80 per cent of Thailand’s trading partners.
Currently, the FTA ratio of Thailand with trading partners stands at 64 per cent, while Singapore’s FTA ratio is 96 per cent, Vietnam 73 per cent and the Philippines 71 per cent.
“This year, the DTN plans to complete pending FTA talks, such as Thailand-Turkey FTA, Thailand-Sri Lanka FTA, and Thailand-Pakistan FTA,” Oramon said.
She is confident that the FTA talks with Turkey will be concluded this year and Thailand will then hold talks with the European Free Trade Association as well as with the European Union.
The DTN will also push for an upgrade of Asean-Dialogue Partners’ FTA, covering China, India, South Korea, Australia and New Zealand, Oramon said.
The DTN will gradually hold talks of the joint trade committee (JTC) with key trade partners.
This year, Thailand hosted a JTC meeting with Vietnam and Bhutan in April and will hold more JTC meetings with Singapore, the United Kingdom, Maldives, China and Bangladesh, Oramon added.
She said the DTN has also drafted action plans to help Thai farmers and manufacturers to benefit from current FTA agreements.
For example, the DTN will hold a fair to promote the operations of its provincial FTA centre in Phayao province from May 27 to 29, and in Nakhon Si Thammarat province from June 10 to 12, she said.
The DTN will hold the second fair to promote products of the four southern border provinces to Asean FTA markets in Narathiwat province from June 16 to 18, Oramon said.
The DTN will join hands with the Thai Agricultural Council to hold an event in Mae Hong Son from August 18 to 20 to improve farmers’ capacities to be prepared for exporting products to FTA markets, Oramon said.
Thailand’s inflation increased 4.65 per cent in April from a year ago and is expected to climb higher this month due to rising prices of fuel and cooking gas, according to the Ministry of Commerce’s Trade Policy and Strategy Office.
The consumer price index (general inflation) stood at 105.15 in April, up 0.34 per cent from March and 4.65 per cent from April 2021.
The Ministry of Commerce forecast Thailand’s inflation rate at between 4.0 and 5.0 per cent this year, which it described as “suitable” for the current situation.
There are still many factors that have contributed to keeping inflation high, including rising global prices of fuel and commodities, fallout of the boycott measures against Russia, the Covid-19 pandemic, and climate change, according to the ministry.
The office director-general, Ronnarong Phoolpipat, said inflation growth in April was lower than February and March, when the increase was the highest in 13 years at 4.71 per cent.
The surge in inflation was caused by higher prices of fuel (as much as 29.74 per cent) and transport cost (up 10.73 per cent). Also, food prices increased 4.83 per cent on average, covering items ranging from eggs and pork to non-alcoholic beverages and daily goods such as toothpaste and soap.
However, some products saw a decrease in prices over the past month, including rice flour and fresh fruits, such as orange, mango and banana.
The Ministry of Commerce expects inflation to continue its growth in May, when compared to the same period last year after the government lowered its subsidy on diesel oil, while cooking gas prices are increasing. Meanwhile, the prices of fresh and cooked foods have been adjusted higher due to the rising costs of raw materials.
Japan’s visiting Agriculture, Forestry and Fisheries Minister Kaneko Genjiro promised his Thai counterpart Chalermchai Srion on Thursday that his country would make it more convenient to import oranges and mangosteen from Thailand.
Speaking to reporters after meeting Genjiro at the Agriculture Ministry, Chalermchai quoted his Japanese counterpart as saying that he would speed up adjustment of the rules to within this year to smoothen the way for imports of the two types of Thai fruit.
During the meeting, the two sides congratulated each other on the success of earlier consultations on technical issues that hampered fruit exports to Japan.
Thana Chiravinij, secretary to the agriculture minister and the permanent secretary for Agriculture, as well as heads of departments under the ministry attended the meeting.
Chalermchai said the meeting, along with one between the prime ministers of the two countries on May 2, served to strengthen ties.
“This was the first physical meeting in several years,” Chalermchai noted.
“This year commemorates the 135th anniversary of diplomatic ties, with the two nations cooperating on various issues, especially in agriculture.”
Chalermchai said Japan is the second biggest market for Thai agricultural products and food.
He said exports of food and agricultural goods to Japan from 2019 to 2021 constituted 11.35 per cent of all Thai exports.
The value of food and agricultural product exports to Japan has averaged THB144.82 billion a year. Exports included processed chicken, frozen chicken, pet food, tuna and smoked rubber sheets, Chalermchai said.
He said Thailand enjoyed a trade surplus of some THB130 billion a year for agricultural products.
During the meeting, the two sides learned that both countries had similar policies to promote the Bio-Circular-Green Economy model in agricultural, he said.
Chalermchai said the policies were aimed at using technologies and local wisdom to raise standards and increase production and hygiene.
According to Chalermchai, Genjiro also agreed to strengthen cooperation with Thailand on agricultural studies and research for sustainable production of food and agricultural products by 2030.
Additionally, the Japanese minister pledged to exchange knowledge and experience with Thailand on developments to make agricultural products more attractive for international markets, Chalermchai added.
The land price around the SRT Light Red Line (Taling Chan-Sala Ya) project grew the most compared to other areas, the Real Estate Information Centre (REIC) reported.
It announced that the top five areas with the highest land price growth in the first quarter of 2022 were:
1. The SRT Light Red Line (Taling Chan-Sala Ya). The project will be constructed in the future. The land price grew by 8.5 per cent year over year. The price increased substantially in both Thawi Watthana and Taling Chan districts.
2. The MRT Pink Line (Khae Rai-Minburi). The line is 90 per cent complete. The price of land in this area grew by 8.2 per cent year-on-year. The price increased heavily in Lak Si and Khan Na Yao.
3. The MRT Purple Line (Bang Yai-Tao Poon). The line was opened in August 2016. The land price grew by 6.7 per cent year over year. The price increased a good deal in Mueang Nonthaburi and Bang Bua Thong.
4. The MRT Blue Line (Bang Khae-Phutthamonthon Soi 4). The project will be constructed in the future. The land price grew by 6.3 per cent year over year. The price increased heavily in Nong Khaem and Bang Khae.
5. The BTS Green Line (Samut Prakan-Bang Pu and Bearing-Samut Prakan). The Bearing-Samut Prakan section has already opened while the Samut Prakan-Bang Pu line will be constructed in the future. The land price grew by 5.8 per cent year-on-year. The price jumped in Mueang Samut Prakan.
The Government Housing Bank’s REIC said electric train plans for the future have influenced land prices.
The Commerce Ministry unveiled a plan on Wednesday to export 530,000 tonnes of fresh fruit to China this year.
To achieve the plan, exports will be carried out via sea, land and air, said Commerce Minister Jurin Laksanawisit.
Last year, Thailand exported 52 per cent of fruits by sea, 48 per cent by land and less than 1 per cent by air, he noted.
Jurin said the ministry would focus on exporting fresh fruit by sea as four Chinese border checkpoints – Mohan, Youyiguan, Dongxing and Pingxiang – were closed off and on due to the Covid-19 situation there and the country’s Zero-Covid policy.
“The Department of International Trade Promotion [DITP] aims to export 530,000 tonnes of fresh fruit to China this year,” Jurin said.
He explained that 390,000 tonnes, or 83 per cent, would be exported by sea via five shipping lines – Cosco, SITC, Yang Ming, Maersk and Wanhai – to six Chinese ports, namely Shekou (26.5%), Nansha (20%), Hong Kong (20%), Zhanjian (13.5%), Xinzhou (13.5%) and Xiamen (6.5%).
“Meanwhile, 36,000 tonnes, or 6.5 per cent, will be exported by air via Thai Airways International, Thai Lion Air, AirAsia X and China Southern Airlines to three Chinese airports, namely Guangzhou (80%), Shenzhen (13%) and Kunming (7%),” he said.
“The remaining 10.5 per cent will be exported by land via four checkpoints. If any checkpoint is closed, the Foreign Ministry as well as commercial and agricultural ambassadors are responsible for negotiating with China to reopen the border point as soon as possible.”
The ministry has set up a war room under the DITP director-general to monitor fruit exports and ensure that Thailand achieves success, Jurin added.
The DITP expects Thailand to produce 5.36 million tonnes of fruit this year, up 11 per cent year on year.
In the first quarter, Thailand exported 754,027 tonnes of fruit worth THB33.98 billion. The exports included 225,159 tonnes of fresh fruit, 213,578 tonnes of processed and canned fruit, 180,254 tonnes of dried fruit and 9,620 tonnes of frozen fruit.
The baht opened at 34.04 to the US dollar on Thursday, surging back from its previous close of 34.53.
The currency is expected to move in a range between 33.95 and 34.15 on Thursday, predicted Krungthai Bank market strategist Poon Panichpibool.
Poon said the factors that would cause the baht to weaken are decreasing because the market is open to more risks. Meanwhile, the Covid-19 situation in China might pressure Asian currencies and keep foreigners from investing in the EM Asia stock market in the short term.
Poon expected the baht to swing sideways near the 34 range. Therefore, he suggested keeping a close watch on foreign investors to see whether they would purchase Thai stocks and bonds now that the currency market is opening to more risks.
He advised businesses to use hedging tools such as options to manage risks in the highly volatile currency market.
The market opened to more risks after the US Federal Reserve did not signal that it would use tight monetary policies as expected. The Fed agreed to increase the policy interest rate by 0.5 per cent as expected and planned to reduce the balance sheet by $47.5 billion (THB1.62 trillion) per month from June before increasing the figure to $95 billion in September.
Chairman Jerome Powell said the Fed might increase the interest rate by around 0.5 per cent at their next meeting to control inflation.
Deputy Prime Minister and Commerce Minister Jurin Laksanawisit said his ministry has prepared measures to help distribute some 566,000 tonnes of fruits in the country.
Jurin, who was presiding over the launch of the Commerce Ministry Fruit Festival 2022 at the main ground in front of CentralWorld in Bangkok on May 2, said the measures are needed as Thai farmers’ fruit output this year was 11 per cent higher than last year.
He said 566,000 tonnes, or 30 per cent of the fruits, will be sold in the country with help from the Department of Internal Trade in their distribution.
Jurin said the department would tap 18 proactive wholesale markets to distribute 244,000 tonnes of fruits and it has also arrange cold storage to freeze some 120,000 tonnes of fruits.
The department will also open 10,092 retail outlets nationwide to distribute 145,000 tonnes of fruits.
Jurin added that the Commerce Ministry Fruit Festival 2022 is part of measures to assist retail outlets. He expected the fair, which will continue until May 8, to help sell some 3,500 tonnes of fruits.
The minister added that the first quarter of this year saw the exports of durians rise by 42 per cent, longans by 36 per cent and mangoes by 21 per cent.
Meanwhile, the department announced that the 10,092 outlets would generate about THB12.5 million in sale value.
The department said the outlets include shopping malls, supermarkets, convenience stores. It said 500 of the outlets would be in Bangkok and the rest in the provinces.
Thailand’s exports of gems and jewellery shot up 37.01 per cent year on year in March over the previous year, according to a report on Wednesday.
The exports were worth US$739.13 million, the Gems and Jewellery Institute of Thailand (GIT) said.
Including gold, the country’s gems and jewellery exports in March were worth $3.40 billion, up 341.39 per cent year on year, said GIT director Sumed Prasongpongchai.
“In the first quarter, the country’s gems and jewellery exports were worth $1.89 billion, up 39.96 per cent year on year,” he said. “The total export value, including gold, was $5.48 billion, up 203.93 per cent year on year.”
He said the rise in Thailand’s gems and jewellery exports could be attributed to the global economic recovery, the gradual reopening of countries, rising purchasing power and investment expansion.
He added that Thailand has exported gold to cash in on the global increase in the price of gold. Thailand exported gold worth $3.59 billion, up 699.05 per cent year on year.
Sumed explained that many of Thailand’s major gems and jewellery export markets have expanded, including the US (46.48 per cent), India (113.98 per cent), Hong Kong (14.77 per cent), Germany (7.97 per cent), United Kingdom (88.29 per cent), Switzerland (82.14 per cent), United Arab Emirates (21.25 per cent), Belgium (29.45 per cent), Italy (129.87 per cent) and Japan (11.22 per cent).
Exports of major products have increased, such as silver jewellery (13.98 per cent), gold jewellery (42.02 per cent), rough diamonds (3.11 per cent), polished diamonds (70.90 per cent), rough gems (27.41 per cent), polished hard gems (48.17 per cent), polished soft gems (50.28 per cent), artificial jewellery (37.62 per cent) and scraps made of precious metals (63.48 per cent), he said.
However, the export of platinum jewellery dropped by 19.78 per cent year on year, he added.
Sumed expected Thailand’s gems and jewellery exports to expand further as many countries have eased travel restrictions, leading to an increase in the number of travellers.
“However, it is necessary to monitor the ongoing Russia-Ukraine war that has hiked production costs and inflation, resulting in impact on purchasing power for luxury goods,” he said.
“Also, it is necessary to follow the impact from the US Federal Reserve’s move to raise the interest rate and the Omicron pandemic,” he added.
In another development, Oramon announced the five-year (2022-2027) vision to mark the DTN’s 80th anniversary this year.
During the meeting, the two sides learned that both countries had similar policies to promote the Bio-Circular-Green Economy model in agricultural, he said.
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