🔺 What to do when markets are at an all-time high? Find smart bargains, like these.See Undervalued Shares

Thai Baht and Taiwan Dollar Tussle for Supremacy in Asia

Published 03/01/2020, 04:20 pm
Updated 03/01/2020, 05:52 pm
Thai Baht and Taiwan Dollar Tussle for Supremacy in Asia

(Bloomberg) -- Emerging Asia’s top-performing currency in 2019 may find itself dethroned this year by a rival that’s also armed with a strong current-account surplus.

Both the Thai baht, which took the regional crown with a 9% gain last year versus the U.S. dollar, and the Taiwanese dollar climbed above the psychologically significant 30-per-dollar level this week. Scotiabank, among the top forecasters for Thailand’s currency last year, recommends investors place long bets on the Taiwan dollar and use the baht to fund the purchase.

“The Taiwan dollar is expected to rally further amid continued capital inflows,” said Qi Gao, a Singapore-based strategist with the Canadian bank, which was consistently ranked by Bloomberg as among the top three forecasters for the baht last year. “Thailand’s regulators are concerned about the currency’s strength. They said yesterday they’re considering new currency measures.”

The trade strategy, which Scotiabank first recommended on Dec. 17, has room to run through the first quarter at least, Gao said. He expects more funds flowing into Taiwan from investments by local firms returning from mainland China despite the prospect of a phase-one trade deal between the U.S. and China. The baht will likely slow its advance from last year, he said.

And if momentum is any indication, the Taiwan dollar may be poised to move into the lead. It has already gained about 1.9% against the baht in the last three months.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.