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Which Asian currency is the weakest these days?

Currently, there is a phenomenon where the money value is at the most depreciated rate in several months, particularly in Asian emerging market currencies (Asia EM). This is due to the strengthening of the US Dollar after the Fed signaled that interest rates might be maintained longer than expected and the Middle East conflict was still hot.

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Asian currencies are so weak that they have broken records

Since 19 April 2024, many currencies, especially Asian currencies, have experienced a sharp depreciation in years, whether it is

  • The Japanese Yen, which broke 154 Yen per U.S. dollar, the most depreciated in 34 years.
  • The Indian rupee hit the lowest in history.
  • Taiwan’s dollar is at its most depreciated in eight years.
  • Indonesia’s Rupiah, which is more depreciated than 16,000 Rupiah per US dollar in four years.
  • South Korean won hit the lowest in 18 months at 1,389.5 won per U.S. dollar.
  • The baht weakened to 37.06 baht per U.S. dollar, hitting its lowest level in six and a half months.

The USD appreciation against major currencies follows the rising yields on U.S. government bonds as investors sell Safe Haven such as gold and U.S. government bonds and acquire more risky assets after the conflict between Israel and Iran after Israeli officials said that the attack was merely symbolic rather than intended to destroy Iran. In contrast, Iranian officials insist Iran has no plans to retaliate against Israel.

Investors believe the Fed will maintain the Fed Funds rate at 5.25 – 5.50 % in its meeting on April 30 – 1 May 2024. In addition, the Fed’s first rate cut this year may be postponed to July from earlier expectations in June after the Federal Reserve Chairman, Jerome Powell, expressed concern about high US inflation.

The adjustment of the baht

Money Market and International Transaction Business Department, TMB Thanachart (ttb) announced that the baht value on 23 April 2024 opened at 37.10 Baht/USD, depreciating from the closing price on the previous day at 37.01 Baht/USD.

Nonetheless, today (24 April 2024) The baht turned stronger (winding in the range of 36.87-37.07 baht/dollar) after the US economic data worsened than expected, increasing the possibility of FED interest rate cuts twice, weakening the dollar, coupled with selling of gold.

Analysts predict that the Baht will not continue to appreciate much because most market players are waiting for the stronger Baht to gradually acquire or increase short THB (weak baht view), especially foreign players after foreign analysts have revised their forecast of baht value to depreciate to 37.50-38 baht/USD in Quarter 2 and 3.

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