The Thai baht edged higher on Thursday after the central bank raised interest rates the previous day, but other Asian currencies and stock markets weakened on worries about the fragile US economy. A flurry of data from China confirmed expectations that its rapid growth cooled somewhat in the second quarter, underscoring investors' concerns that the global recovery may be losing some momentum.
The MSCI index of stocks in Asia-Pacific outside Japan fell 0.8 percent by 0700 0625 GMT. It had briefly turned higher after the Chinese data. The baht firmed 0.12 percent in early trade on expectations of further policy tightening by the central bank, which raised rates on Wednesday after leaving them at a record low for 15 months.
A second trader said the baht may gain further to 32.20 per dollar next week, where it could trigger central bank intervention. Dollar/baht was bid at 32.28 at 0621 GMT against 32.30 late on Wednesday. The baht has gained 0.40 percent in the past week and 3.25 percent this year.
The won pared earlier losses as the Chinese economic data eased worries about a sharp slowdown in South Korea's top foreign market, and on continued foreign buying of Korean stocks. The won was quoted at 1,201.7, against its previous close of 1,202.5. Earlier, it weakened to 1,208.9. Foreign investors bought a net 204.9 billion won worth of stocks on the main exchange after having purchased a combined net 1.9 trillion won during the five consecutive sessions.
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