Pound Sterling to Thai Baht (GBP/THB) Exchange Rate Forecast to Dive as Thai Growth Betters Estimates

The Pound Sterling to Thai Baht (GBP/THB) exchange rate dived by around -0.70% on Monday morning.

With British economic data printing relatively disappointingly on Monday, the Pound edged lower versus many of its major peers. The depreciation was somewhat slowed, however, amid heightened demand after a spate of profit-locking took the Pound down to unjustified levels.

The Thai Baht, meanwhile, advanced versus the majority of its most traded currency rivals after economic growth outpaced expectations. The gains have been somewhat laboured, however, with a number of headwinds forecast to see the growth acceleration short-lived.

The Pound Sterling to Thai Baht (GBP/THB) exchange rate is currently trending in the region of 52.2500.

After domestic data failed to show significant improvement, the Pound edged lower versus many of its most traded currency rivals. On the year, Rightmove House Prices advanced by 2.5% in May; considerably lower than the previous figure of 4.7%. On the month, May’s House Prices cooled by -0.1%. The cooler house prices have been linked to general election jitters.

‘Pre-election jitters finally came home to roost in the final weeks of electioneering,’ said Rightmove director Miles Shipside. ‘This is an election-driven price stall which gives some buyers only short-term relief from the backdrop of a long-term housing shortage.’

‘Election uncertainty and particularly the threats of financial penalties to non-doms, landlords and those with properties valued at over two million pounds put a brake on the market,’ Shipside added. ‘Their removal gives a reason for a rebound in activity and prices.’

The Thai Baht advanced versus the majority of its most traded currency rivals on Monday after economic growth bettered estimates. On the year, Gross Domestic Product advanced by 2.0% in the first-quarter, bettering the median market forecast 2.9%. On a quarterly basis, GDP advanced by 0.3% in the first-quarter despite the market consensus of -0.4% declination. The better-than-expected rate of growth is expected to be short-lived, however, with several headwinds weighing on economic progress.

‘With the economy facing headwinds such as slow budget disbursement, high household debt, lacklustre global demand and the prospect of renewed political uncertainty, we think the acceleration in 1Q15 [first-quarter 2015] will likely prove short-lived,’ Krystal Tan from Capital Economics said in a research note.

‘Given that government consumption accounted for a mere 14% of GDP in 2014, along with the subdued sentiment at this juncture, it might take a while for the expected pickup in fiscal spending in 2H15 [second-half of 2015] to eventuate into a material domestic pickup,’ Weiwen Ng from ANZ Research said.

With an absence of Thai economic data over the coming weeks, the Pound Sterling to Thai Baht (GBP/THB) exchange rate is likely to fluctuate as the result of Sterling movement.

The Pound Sterling to Thai Baht (GBP/THB) exchange rate was trending within the range of 52.0690 – 52.8060.