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USD/THB closed at 32.65 on May 15, up 0.77% on the session and roughly 2% weaker over the past month. For Thai exporters pricing Q2 invoices in dollars, this is no longer the kind of swing you can shrug off — it directly changes how much baht hits your account once a wire clears. The mix of low local rates, Middle East risk premium, and renewed dollar strength is going to keep the pair choppy into June.
Why 32.65 matters more than the usual headlines
The Bank of Thailand held its policy rate at 1.00% in April, the lowest setting since 2022. With Fed funds still well above that, the carry math keeps pulling capital out of THB and into USD. That alone explains a chunk of the 3.5% year-to-date USD gain against the baht. Layer on the unresolved US-Iran tension that’s pushed oil higher and you have two reinforcing reasons for dollar bid.
The forecast band most desks are using for May runs roughly 32.04 to 33.68, with a mid-month average near 32.79. That’s about 2% of range to plan around, which is meaningful if you’re moving USD 1 million in invoices.
What this means for Thai exporters
If you book a USD 500,000 sale today at 32.65, that’s THB 16,325,000. If the rate slips to 32.04 by the time you collect, you receive THB 16,020,000 — THB 305,000 less, or about 1.9% of the deal. Going the other way (33.68), you’d gain roughly THB 515,000. Asymmetric, but not in a way most CFOs are happy to leave open.
The practical fix for receivables in the next 90 days is some form of forward cover — either a plain forward through your house bank, or a participating forward if you want to keep some upside. Local banks have been quoting USD/THB 3-month forwards at modest pickup over spot given the rate differential, so the cost of certainty is comparatively low right now.
A rough hedge ratio to think about
Most Thai exporters I’ve spoken to in the last two weeks are targeting a 50-70% hedge on dollar receivables and leaving 30-50% unhedged. That balance assumes you have some natural USD payables on the other side (imported components, shipping, USD-denominated debt) which act as a partial offset. If your business is pure export with baht costs, push the hedged share higher — toward 80%.
SMEs running invoices under USD 200,000 often skip forwards because the bid-offer feels punitive. A workable alternative is a multi-currency account at a bank like Bangkok Bank or KBank, holding USD on the receivable side and converting in slices when the rate aligns with your business plan.
What to watch through June
Three things will move the pair most:
- Any escalation or de-escalation in the Middle East. Oil prices feed the dollar bid; a ceasefire path pulls it back.
- The next MPC meeting — another cut would weaken the baht further; a hold is roughly priced in.
- Foreign equity flows into SET. The recent week saw modest net buying after the US-China summit; sustained inflow tends to support the baht at the margin.
Bottom line for Thai businesses
32.65 is not the panic level, but it is the level where doing nothing has a real cost. Lock at least half of your near-term USD exposure, keep some flexibility for a sharper move either direction, and treat the next two MPC dates as the practical decision points. Hoping for 31-handle THB through Q2 is wishful — the rate environment doesn’t support it.
