According to The Straits Times - Breaking News, Lifestyle & Multimedia News , the Thai baht and the Singapore dollar appear to be competing to be South-east Asia's best-performing currencies in 2023. After China lifted the majority of its Covid-19 regulations during the past month, opening the door for a rebound in outbound travel, the baht is expected to be supported by an influx of Chinese tourists. Since the world's second-largest economy is also Thailand's largest export market, its attempts to promote growth should also be beneficial.
If the December inflation numbers, which are due on Thursday, confirm experts' predictions that Thailand's consumer price index is starting to climb once more, the baht may get an early year boost. According to Mr. Christopher Wong, a foreign exchange analyst at OCBC Bank, as the United States Federal Reserve reduces the pace of its own rate hikes, driving down the dollar, the Thai currency should benefit alongside its Asian counterparts as well.
The Singapore dollar, according to The Straits Times - Breaking News, Lifestyle & Multimedia News, is the only Asian currency to gain value against the US dollar last year, is the other probable regional victor. The Monetary Authority of Singapore (MAS), which tightened monetary policy by raising the midpoint of its exchange rate band three times in 2022 to combat inflation, has helped the Singapore dollar.
The other two major regional currencies are plagued by drawbacks, making it doubtful that they will compete with the two front-runners. The central bank of Indonesia has already hinted that its cycle of rate hikes may be coming to a stop, thus the Indonesian rupiah is expected to struggle. The Philippines' trade imbalance is expected to weigh on the peso, while Malaysia's ringgit is losing momentum as the outlook for commodities prices deteriorates.
