The Baht is expected to weaken in 2025, with added pressure from Trump’s policies (Current Issue No.3544)

• The Baht ended 2024 at THB34.11/USD, close to the year-end figure for 2023. However, its movements during the year were rather in a wider range and experienced significant fluctuations. 
• For 2025, three key factors must be monitored: 1) developments in the US, including both the direction of the Fed's interest rates and the impacts of President Trump's policies; 2) the potential slowdown of the Chinese economy; and 3) the Thai economy’s weak fundamentals bringing the risk of a slow recovery, which may cause the Baht to move within a weak range.
• The Baht's depreciation may become more evident in the second half of 2025, especially as the Fed nears the end of its rate-cutting cycle. The Thai currency is likely to end 2025 at THB35.50/USD (KBank projection).