“Dollar Strengthens – Baht Weakens: Oil, Fed & Geopolitics Driving Asia’s Currency Pressure”

he Thai baht in Q1 2026 is expected to strengthen against the US dollar, driven primarily by a weaker dollar globally, a seasonal tourism boost, and expectations of US Federal Reserve rate cuts. This strength is occurring despite a weak domestic economic outlook and the Bank of Thailand's (BoT) likely continued easing of its policy rate. Exchange Rate Drivers and Forecast External Factors: The primary driver for the strengthening baht is external, mainly the broad weakness of the US dollar as global markets price in expected Fed rate cuts. The baht is also correlated with global gold prices, which have been climbing. Tourism High Season: The period extending into Q1 2026 is the high season for tourism, which typically brings in foreign currency and supports the baht's value. Policy Divergence: The BoT is expected to continue its easing cycle, potentially cutting the policy rate further to 1.00% by Q1 2026 to stimulate the sluggish domestic economy. This divergence from a potentially less aggressive US Fed in Q1 could support the baht in the short term, though some analysts warn the currency could weaken later in 2026. Forecasts: Projections for 2026 generally place the baht in a range of 30.80–33.00 per US dollar. Some models estimate it could trade around 31.06 by the end of Q1. A persistently strong baht below 31 per US$ is seen as a significant risk to the Thai export and tourism sectors. Key Economic Context Weak Growth: Thailand's economy is expected to slow down to a 5-year low growth rate of around 1.6-1.8% in 2026, pressured by US tariffs, global trade tensions, and high household debt. The central bank chief expects an improvement in Q1 2026 after a weak second half of 2025. Political Uncertainty: A general election expected in February 2026 could also introduce volatility, though some historical trends suggest the baht may strengthen following the formation of a new government. Low Inflation: Headline inflation is projected to remain subdued or even negative, providing the central bank with justification for further rate cuts to stimulate demand. In summary, Q1 2026 is characterized by a strong and volatile baht driven by external factors, contrasting sharply with a weak domestic economy and accommodative monetary policy.

U.S. Independence Day (July 4th)

Thai Rice 2026 – Turning the Twin Crisis into Golden Opportunities in the Global Premium Market SO OK TRADING | 19 AUG 2026 The year 2026 marks a defining challenge for Thai Rice on the global stage, facing a Twin Crisis of a strong baht and severe El Niño. Yet within this crisis lies a “golden opportunity” waiting to be seized. SO OK TRADING is committed to driving Thai rice into the world’s premium markets under the philosophy FAST • SHARP • RELIABLE. We recognize the potential of Thai Hom Mali Rice and Carbon-Low Rice, which perfectly align with the growing demand for quality and sustainability in Europe and the United States. From pressure to opportunity — Thailand is ready to reshape the game through G2G strategies with China and Singapore, expansion into premium markets, and leveraging the surge in global food security demand. We firmly believe: “Thai Rice is not just a product, but a story of quality and national pride.”