The Thai baht over the past three months had significantly weakened against the U.S. Dollar in the face of political unrest and massive protests. However, something has changed in Thailand. The currency markets are beginning to price in a recovery in the Thai Baht. The Bank of Thailand’s chief in the face of US Federal Reserve tapering has said their is no need for tighter monetary policy to stem dollar outflows. These comments from the Bank of Thailand chief assert Thailand’s optimism in its economy. The USD/THB currency pair has broke a major uptrend signaling a change in sentiment towards Thailand for the time being. This change in sentiment may be due to a belief in political unrest and massive protests subsiding or a solidified stance on monetary policy. Whatever the case, the currency markets are beginning to re-price risk in the Thai Baht which could mean the Thai Baht could increase against the Dollar.

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