Poon said the baht is likely to strengthen due to the weakening of the dollar, gold sell-offs and foreign investors interest in Thai stocks.

The baht may also be highly volatile because it has gone past the key support level of 33 to the dollar, which was the stop-loss level set by foreign investors. They may change their baht holdings, which could make the currency strengthen suddenly.

Poon believes the baht will not rise much, especially when economic recovery is factored in. The baht’s drop to below 33 to the dollar prompted some importers to exchange the dollar. The baht’s key support level should stand at 32.80 to the dollar, Poon said.