Pattaya May 2019

BUSINESS SUPPLEMENT
FOREIGN CURRENCY UPDATE
TheU.S. Dollar gained ground
even as the Federal Reserve re-iterated
it had no plans to raise rates.
However news that if could react either
way as data came in supported
the greenback. The DXY index, (an
index that measures the U.S. Dollar’s
value against a range
of major currencies), rose
slightly from 96.40 to 96.96
after hitting a high of 97.42.
Against the Thai Baht, the
U.S. Dollar also rose by the
same amount indicating
that the Thai Baht has been
relatively steady for the last
month or so. The USD/THB
rate moved from 31.61 to
31.77.
Where the British
Pound is concerned, exhaustion
appears to have
settled in with a further Brexit delay
keeping many to the sidelines.
The Pound has remained broadly
in the range of 1.2950 to 1.3150 to
the US Dollar with the boundaries
narrowing slightly. Dips towards
1.2940 have been recently bought
up, bringing the currency back into
the range. Worth pointing out is that
a flat market is one where there
are an equal number of buyers and
sellers and so there is really maximum
disagreement about future
direction of the currency. As such, a
breakout in either direction could be
quite sharp. Against the Thai Baht,
the pound reached a high of
41.91 but has mainly been flat at
around 41.50 for most of the last
month.
The U.S. Dollar vs. Japanese
Yen cross-rate has seen a little
more volatility than other currency
pairs, with trade reaching a low
of 109.84 before rebounding to
112.06. Most of this move can be
attributable to the Yen itself, with its
safe haven status unwinding in the
face of a stronger than expected
U.S. earnings season. Against the
Thai Baht, the Yen rose very slightly
from 0.2815 to 0.2868 only to then
settle back to 0.2815.
The Russian Ruble moved from
63.80 to 65.60 to the US Dollar, and
then reversed course to return to
the 64.00 handle. This move shows
a slightly increased level of volatility
but it is still muted compared to the
Russian currency’s medium term
movements. Against the Thai baht
the Ruble strengthened slightly
from 0.491 to 0.498 after dropping
to a low of 0.476.
The Euro vs. the U.S. Dollar
cross-rate saw a high of
1.1410 and a low of a 1.1195,
however it settled in the middle
of the range at 1.1306.
Continuation of European
Central Bank stimulus and a
dovish stance from ECB President
Mario Draghi did little to
move the currency, with most
of the news already baked
in. Less volatility was seen
against the Thai Baht with
the rate moving from 35.84 to
35.59 and then back to 35.87.
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