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Analyst’s Disclosure: I/we have a beneficial long position in the shares of ARCC, BXSL, HTGC, TSLX, MSDL, RWAYI, TRIN either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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FUNDAMENTALS

Spot gold held its ground at $4,454.68 per ounce by 0057 GMT, after hitting its lowest level since August 19 in the previous session.
U.S. gold ‌futures for ⁠December delivery ⁠rose 0.5% to $4,503.70.

Key U.S. data this week include job openings, the ADP employment report ​and nonfarm payrolls data that will be scrutinised for clues on labour market health and ​interest rate outlook.

Traders currently see a 65% chance of a September U.S. rate hike, according to the CME FedWatch Tool.

Live Events

Gold fell more ​than 3% on Friday after Federal Reserve Chair Kevin ⁠Warsh said ‌the U.S. central bank will “have work to do” if ​policymakers don’t ​get the confidence they need that inflation is heading down ⁠to 2%.
While gold is considered a hedge against ​inflation, higher rates typically weigh on the metal by ​boosting the appeal of yield-bearing assets.U.S. President Donald Trump told reporters in the Oval Office that he has a lot of respect for Warsh and that “he’ll do what he has to do” on interest rates.

Meanwhile, Trump threatened further strikes against Iran on Monday after the first ‌exchange of direct attacks in a month, raising tensions in a conflict that had recently shifted into an economic standoff.

Among ​other metals, ​spot silver gained 0.4% ⁠at $66.77 per ounce, platinum edged 0.7% higher at $1,802.67, while palladium firmed 0.8% to $1,367.25.

DATA/EVENTS (GMT)

0145 China RatingDog Manufacturing PMI Final August

0600 UK Nationwide house price mm, yy ​August

0750 France S&P Manufacturing PMI August

0755 Germany S&P Manufacturing PMI August

0800 EU S&P MFG Final PMI August

0830 UK S&P Global Manufacturing PMI August

0900 EU HICP Flash YY August

0900 EU HICP-X, F, E, A, T Flash YY, MM August

0900 EU Unemployment Rate July

1345 US S&P Global Mfg PMI Final August

1400 US ISM Manufacturing PMI August

OCBC reports the Thai baht’s bullish trend against the USD, now near 34.80, faces limits from Bank of Thailand intervention concerns. Export competitiveness worries may cap gains, keeping USD/THB range-bound between 34.70–35.30, with traders advised to watch for official signals or reversals.

Currency Strength Amid Regional Tailwinds

OCBC’s latest analysis reveals the Thai baht has strengthened to approximately 32.80 per US dollar, its strongest level in months, driven by regional currency momentum, improved domestic sentiment, and a weaker US dollar. This appreciation aligns with a broader Asian currency trend, as markets anticipate potential Federal Reserve rate cuts later this year. However, OCBC cautions that Thailand’s heavy reliance on exports makes it particularly vulnerable to currency strength compared to regional peers, setting the stage for closer scrutiny from domestic monetary authorities as the baht’s rally continues to unfold against the dollar.

Bank of Thailand’s Intervention Risk Looms Large

Despite the bullish momentum, OCBC emphasizes that the Bank of Thailand’s (BoT) sensitivity to rapid appreciation could significantly cap further gains. The central bank has historically intervened when currency strength threatens export competitiveness, using tools such as direct market intervention, interest rate adjustments, or verbal warnings. OCBC projects the USD/THB pair will likely remain range-bound, with support near 32.70–32.80 and resistance around 33.20–33.30. This creates a critical dynamic where traders pursuing the baht’s upside must carefully weigh the probability of official intervention, which could trigger abrupt short-term reversals and disrupt otherwise favorable trading positions.

Implications for Traders and Businesses

For market participants, understanding BoT’s policy stance is essential, as intervention can swiftly alter currency direction. OCBC advises closely monitoring verbal cues and economic data releases that might signal impending action. Businesses engaged in Thai trade face a dual-edged impact: a stronger baht reduces import costs but simultaneously erodes export competitiveness and pricing power internationally. Additionally, currency strength could dampen tourism appeal by making Thailand more expensive for foreign visitors. Investors should also factor baht movements into assessments of Thai equities and bonds, since currency stability directly influences asset attractiveness and returns, making vigilance around BoT actions a critical component of any Thailand-focused investment or trading strategy.

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