# Is the Thai baht at risk with to Donald Trump’s return to the White House?

- Link: https://www.thailand-business-news.com/banking/175915-is-the-thai-baht-at-risk-with-to-donald-trumps-return-to-the-white-house
- Published: 2024-11-21T07:31:00+07:00
- Author: Nguyen Trang

**The Thai baht faces vulnerability due to increased trade reliance on China and
the US amid political changes. Trump’s presidency and Fed’s policies may weaken 
the currency, impacting economic stability.**

---

## Key Points

 * The Thai baht is at risk due to Donald Trump’s return to the White House, as 
   the country relies heavily on trade, making it vulnerable to U.S. tariffs. Citigroup
   identifies the baht and Taiwan dollar as the most exposed in Asia to economic
   shifts influenced by Trump’s policies. Early market reactions indicate that trade-
   reliant nations are particularly susceptible.
 * Following the election, Fed rate cut predictions have decreased, while the Dollar
   Index is strengthening, creating pressure on the Thai baht amid political uncertainties.
   The recent appointment of Kittiratt na Ranong as the Bank of Thailand’s chairman
   raises concerns over potential governmental influence on monetary policy, with
   expectations for lower interest rates in the coming year.
 * Jerome Powell, the Fed chairman, has indicated a cautious approach to rate cuts,
   citing the strength of the U.S. economy. Current forecasts predict an average
   of THB34.70 per dollar in 2024, however, challenges for policymakers may lead
   to a rise in the baht’s exchange rate, posing issues for exporters and foreign
   investors.
 * The baht’s real effective exchange rate (REER) stands 1.5% higher than its 10-
   year average, based on data from the Bank for International Settlements. This
   metric reflects the currency’s value relative to a basket of other currencies,
   where a higher REER suggests reduced trade competitiveness.

The Thai baht is on track to experience significant vulnerability amid changing 
political dynamics, particularly due to Donald Trump’s resurgence in the White House.
Given Thailand’s high dependency on trade—boasting a trade volume that is 129% of
its GDP—the baht’s position is precarious, especially as U.S. monetary policy, under
the hawkish Federal Reserve, threatens to further weaken it. The rise of the dollar,
fueled by Trump’s policies intended to enhance U.S. production, poses additional
risks for trade-reliant economies, positioning Asian currencies, including the baht,
for potential declines.

ADVERTISEMENT

Thailand’s interdependence with major trading partners like the U.S. and China, 
which account for a third of its exports, magnifies this risk, especially if Trump
implements import restrictions. Analysts from Citigroup have flagged the Thai baht—
alongside the Taiwanese dollar—as particularly susceptible to tariffs, indicating
a looming threat to the currency’s stability amid shifting global trade policies.

### Related**Posts**

###  󠀁[Thailand Business News — Morning Briefing | Tuesday, 3 November 2026 | Thailand, ASEAN and Global Markets](https://www.thailand-business-news.com/news/338217-thailand-business-news-morning-briefing-tuesday-3-november-2026-thailand-asean-and-global-markets)󠁿

###  󠀁[Thailand Business News — Morning Briefing](https://www.thailand-business-news.com/banking/337929-thailand-business-news-morning-briefing-5)󠁿

###  󠀁[Bank of Thailand Raises Growth Forecasts but Warns Recovery Remains Concentrated](https://www.thailand-business-news.com/banking/337755-bank-of-thailand-raises-growth-forecasts-but-warns-recovery-remains-concentrated)󠁿

###  󠀁[Thailand Watches US Midterms for Signals on Trade, Investment and Regional Stability](https://www.thailand-business-news.com/politics/336882-thailand-watches-us-midterms-for-signals-on-trade-investment-and-regional-stability)󠁿

Moreover, the uncertainty surrounding the Federal Reserve’s monetary policy and 
Trump’s election victory has led to a decline in expectations for interest rate 
cuts, now projected at three instead of four within the next year. As U.S. Treasury
yields increase and the dollar index strengthens, the Thai baht faces compounded
pressures exacerbated by internal political dynamics.

The recent appointment of Kittiratt na Ranong, a government ally and former Finance
Minister, to lead the Bank of Thailand, raises concerns about the politicization
of the central bank, potentially undermining its independence. Previous forecasts
had suggested a rate cut to 2% early next year, but Kittiratt’s influence might 
steer policymakers towards lower rates, adding complexity to the economic landscape.
With projections indicating a depreciation of the baht, touching THB34.70 per dollar
in 2024—and fears of it reaching THB36-37—exporters and investors alike may face
significant challenges, underscoring a period of heightened uncertainty for Thailand’s
economy.