Bloomberg News

Baht Approaches Two-Week High as G-7 Pledge Improves Sentiment

June 06, 2012

Thailand’s baht advanced toward its strongest level in two weeks and government bonds fell after policy makers from the world’s leading economies agreed to coordinate their response to Europe’s financial crisis.

The Bloomberg-JPMorgan Asia Dollar Index climbed the most in eight weeks and the MSCI Asia-Pacific Index of shares rose after Japanese Finance Minister Jun Azumi said yesterday that officials from the Group of Seven nations will work together to help put the public finances of Spain and Greece on a sustainable footing.

“Coordinated support will help stabilize the situation in Europe,” said Hideki Hayashi, a researcher at the Japan Center for Economic Research in Tokyo. “That is leading to better sentiment in emerging-market stocks and currencies. However, this will be only temporary as the debt problem still persists.”

The baht appreciated 0.6 percent to 31.44 per dollar as of 3:08 p.m. in Bangkok, according to data compiled by Bloomberg. The currency reached 31.43 yesterday, the strongest level since May 23. One-month implied volatility, a measure of exchange-rate swings used to price options, was unchanged at 4.52 percent.

The yield on the 3.25 percent bonds due June 2017 rose two basis points, or 0.02 percentage point, to 3.41 percent, according to data compiled by Bloomberg.

To contact the reporter on this story: Yumi Teso in Bangkok at yteso1@bloomberg.net

To contact the editor responsible for this story: Sandy Hendry at shendry@bloomberg.net.


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