Ceasefire bid boosts baht

Thailand's baht yesterday gained from a seven-week low and bond risk fell as the Government offered protesters ceasefire talks after extending a deadline for women and children to leave an area where gun battles have taken place.

The currency halted three days of losses as the Government called on protesters to stop all armed attacks before talks could begin.

"We aren't in a situation where you can be optimistic about it and where you want to buy the baht and other Thai assets," said Tadahiro Toriyama, a foreign-exchange trader at Sumitomo Mitsui Banking in Bangkok.

"However, many traders and customers, including us, are operating at back-up sites and are not in a situation to aggressively take positions, limiting the move in the baht. Exporter demand for the baht is underpinning the currency as well."

The baht advanced 0.2 per cent to US32.40c against the greenback, according to data compiled by Bloomberg. On Monday it touched US32.50c, the weakest level since March 26.

The currency may trade mostly in a range of US32.40c and US32.50c, Toriyama said.

The cost of credit-default swaps insuring Thai government debt from default fell 9 basis points to 156 basis points, halting a three-day climb, according to Royal Bank of Scotland prices. A basis point is 0.01 percentage point.

The SET index of the country's stocks had its lowest close on Monday since April 29.

Global funds sold a net 31.3 billion baht ($1.3 billion) of Thai equities in the past nine days, the most since a similar period ended on August 17, 2007, according to stock exchange data.

- BLOOMBERG