Mr. Kobsit Silpachai, Economic and Capital Market Research Executive Kasikorn Bank revealed that the bank has adjusted the target range for the baht in 2022 from 37.50 baht per dollar to weaken at 35.25 baht per dollar and in 2023, the frame is 33.50-34.00 baht per dollar. which will begin to see the baht return to appreciating direction But appreciation will not be a jump. And the appreciation will start to be seen clearly from March ’23
through an appreciation of the baht It will be seen that the movement will follow the monetary policy of the United States Federal Reserve. (Fed) mainly up to 95-96%, which in the past, an increase in the dollar index has increased by 1 point, for example, from 106 to 107, the baht will increase by 32 satang, but after this must come back to look more at domestic factors Because the Fed is signaling an adjustment in monetary policy.
However, it appears that the Fed’s rate hike will not be swift and drastic. It is expected to adjust from 0.75% to 0.50% after raising interest rates by 3.75% and will raise interest rates to 5% and hold or fall gradually in 2023 after global inflation has reached its peak. At the level of 7.5 %, giving the Fed more confidence. As a result, the increase in interest rates is at a lower rate. and saw an opportunity to return interest
However, although Fed officials still insist that there is no cut in the interest rate. Because it’s a concern for speculation. and make monetary policy adversarial. Because from the Fed’s monetary policy data 14 times, it was found that the economy went into recession (Recession) 12 times and economists believe that the chances of the economy kneeling into a recession within a year, the United States has chance of 63% of euro 50% original Zone 80% English and Russian 90%, Thai part from 10% to 15%
“We are starting to see inflation pass its peak. Reflecting that the problem the Fed has successfully done is to cause the Fed’s rate increase to slow down and in 2023 it will gradually decrease. As for Thailand, it is expected that the Monetary Policy Committee (MPC) will raise another 0.25% at the last meeting and in 2023, twice more to 1.75% per year. The MPC will not raise interest rates as much as the Fed. Because the Thai economy, although in the second quarter, is still able to grow at 4.5%, but is not yet ready to support the increase in the high interest rate. As there are still structural problems and growth is still well below potential at 4.7%, it is not appropriate to raise interest rates aggressively.”
In terms of the domestic factors that need to be monitored and that affect the appreciation of the baht, A matter of economic recovery that will come mainly from the tourism sector. The increased number this year from 9.75 million to 13-20 million will affect the spending and consumption of foreign tourists. which people in the service sector will receive merit And if the number of tourists reaches 1 million per month on average, it will cause the current account balance from negative or deficit to turn back to positive in 2023, which will help to strengthen the baht. by Kasikorn Bank It is expected that the current account balance in 2023 will turn slightly positive. Or negative at $ 3,500 million from the year 2022, the current account deficit of -1.7 billion dollars. This was similar to the deficit during the Tom Yum Kung Crisis of 1997, when Thailand had a current account deficit of about $15 billion.
However, in 2023, although the Fed will continue to take measures to reduce the size of the balance sheet by withdrawing liquidity or QT and will see the recession problem as a new problem. And inflation is an old problem. causing the dollar to fluctuate and the baht will start to appreciate But probably not as strong as in 2018-2019 which will see 33 baht per dollar. But we will in the next 2-3 months the money will vary. and the beginning of the year – the middle of the year Begin to see the dollar fall due to the recession and the adjustment of the Fed policy. Therefore, there will be further instability.
