Bank of America: Raises Thai Baht Forecast Due to Oil Price Impact and Weak Tourism Industry

LootboxPhobia · 2026-03-17T14:11:08+00:00

Bank of America revises Thai baht forecast, expecting depreciation to 1 USD/33 THB in mid-2026, then appreciation to 1 USD/31 THB by year-end. Thailand's current account may slide into deficit due to weak oil prices and seasonal tourism weakness, but improvement in the basic balance in the second half will drive Thai baht appreciation.

LootboxPhobia

2026-03-17 14:11:08

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Investing.com - Bank of America has revised its forecast for the Thai Baht, expecting the currency to depreciate to 33 Baht per US dollar by mid-2026, then appreciate to 31 Baht per US dollar by the end of the year, compared to the previous forecast of 30 Baht per US dollar.

The bank stated that oil price shocks coincided with stock inflows following Thailand’s general election, leading to an increase in Thailand’s nominal effective exchange rate. This has added resistance to policy at around 31 Baht per US dollar.

Due to seasonal weakness in tourism and income repatriation flows, Thailand’s current account buffer is narrowing in the second quarter. Oil prices remained stable above $80 per barrel, which may temporarily push Thailand’s current account into deficit and keep the Baht at a weaker level.

The bank expects that, driven by an improvement in Thailand’s fundamental balance of payments in the second half of the year, the Baht will appreciate to 31 Baht per US dollar by the end of 2026. The fundamental balance of payments combines the current account and net foreign direct investment flows.

The revised forecast reflects the impact of high oil prices and seasonal tourism weakness on Thailand’s external accounts. Bank of America expects that currency weakness will be temporary and will recover in the second half of 2026.

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