Thailand’s baht had its biggest weekly decline in a month and government bonds rose after the central bank cut the growth forecast for exports, citing Europe’s debt crisis.
Overseas shipments will increase 8 percent this year, compared with an earlier estimate of about 9 percent, Songtham Pinto, director of the Bank of Thailand’s office of macroeconomics, said this week. The MSCI Asia-Pacific Index of shares fell for a second day after data from HSBC Holdings Plc and Markit Economics showed that China’s manufacturing may shrink for an eighth month in June.
“Concern about Europe’s debt crisis is lingering in the market, and there are growing worries about the global economic slowdown,” said Kozo Hasegawa, a Bangkok-based trader at Sumitomo Mitsui Banking Corp. “Regional currencies will continue to see some selling pressure for a while.”
The baht retreated 1.1 percent this week, the most since the five-day period ended May 25, to 31.81 per dollar as of 3:16 p.m. in Bangkok, according to data compiled by Bloomberg. It lost 0.4 percent today and touched 31.85, the weakest level since June 1.
The currency’s one-month implied volatility, a measure of exchange-rate swings used to price options, was steady at 4.52 percent this week and today.
Exports rose 0.65 percent in May from a year earlier after declining 3.67 percent in April, while imports climbed 8 percent following a 7.87 percent increase, according to median estimates of economists in Bloomberg News surveys before government data next week.
The yield on the 3.25 percent bonds due June 2017 fell one basis point, or 0.01 percentage point, to 3.34 percent this week, according to data compiled by Bloomberg. It was unchanged today.
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