Before the pandemic, the Thai baht was the strongest-performing currency in Asia. Now, it’s the worst-hit currency in the region, according to Japan-based Mizuho Bank. The Thai economy has been shrinking over the past year, hitting lows which some compare to the contraction during the 1997 Asian financial crisis. The Japanese bank says the under-performance of the Thai baht is “uncharacteristic” and renders it “the worst performer to date in 2021.”
The financial analysis platform Refinitiv Eikon also found the Thai baht to be the weakest-performing currency in the Asia Pacific region. As of this morning, the Thai baht had dropped more than 10% against the US dollar year-to-date, according to data from the company. Against the US dollar, the Japanese yen dropped by almost 7% and the Malaysian ringgit declined by 5%.
For Thailand, which relies heavily on tourism, the lack of international arrivals due to travel restrictions multiplied the “Covid devastation” on the economy, according to the bank’s head of economics and strategy, Vishnu Varathan. As of this May, Thailand only had 34,000 tourist arrivals. Before the pandemic in 2019, the country welcomed around 40 million tourists.
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