The Thai baht has soared against the U.S. dollar this year, significantly more than many other emerging market currencies.
That strength, however, is sparking concerns as the country’s domestic economy weakens, analysts said.
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Since the beginning of this year, Thailand’s currency has jumped more than 5% against the dollar. On a year-over-year basis, it has bounded even higher — nearly 8%.
Other top performing emerging market currencies in the region have also strengthened against the dollar — but still lag behind the baht. Both the Indonesian rupiah and the Philippine peso, for instance, have risen more than 3% against the dollar so far this year.
“Policymakers and exporters in Thailand are once again voicing concern about the strength of the baht,” Gareth Leather, senior Asia economist at research firm Capital Economics, wrote in a note earlier this month. “While most (emerging market) currencies have appreciated against the US dollar in recent months, none have risen by as much as the baht.”
