THB: Slumps On Further Gold Fall, Threatening Upside Test Of Downtrend Channel
USD/THB is rising with broader USD trends, as a fresh silver plunge (-13%) sparks broader risk off. Still, with gold also down around -2-3%, THB is the weakest performer in EM Asia FX far today (off just over 0.50%). The pair was last in the 31.80/85 region, close to 100-day EMA resistance. The pair hasn't been above this resistance point in a meaningful way since Oct last year. The 200-day EMA is further north around 32.36. This latest spike is also threatening to drive USD/THB out of its downtrend channel, drawn from the April 2025 high, see the chart below.
- As we noted earlier in the week, the Thailand authorities arguably wouldn't be minding gold weakness to the extent that unwinds some of the THB gains seen though much of the second half of 2025 and into early 2026.
- Hence we may not see much BoT intervention capping USD/THB at this stage.
- Outside of broader macro/metals moves, coming up shortly we have the Jan CPI figures, whilst this weekend also has the Thailand election. We publish our preview for this overnight, see this Hidden PDF. This may also be aiding USD/THB at the margins.
Fig 1: USD/THB Above Downtrend Channel Resistance?
Source: Bloomberg Finance L.P./MNI
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JGBS AUCTION: Poll: 10-Year JGB Auction
*JAPAN 10Y GOVT BOND AUCTION MAY HAVE 100.00 LOWEST PRICE:POLL – BLOOMBERG
JGBS AUCTION: 10Y Supply Faces A Higher Yield & A Steeper Curve
The Japanese Ministry of Finance (MoF) will today sell Y2.6tn of 10-year JGBs. The MoF last sold 10-year debt on 2 December 2025. This month's auction offers an outright yield hovering around its cycle high, around 25bps higher than the level of last month's auction.
- The 2s/10s yield curve has steepened further since last month’s auction and is now at a cycle high, while the 7s/10s curve is little changed.
- Sentiment toward longer-dated bonds remains under pressure amid ongoing fiscal concerns.
- BoJ Governor Ueda reiterated the central bank’s tightening bias yesterday. However, OIS pricing remains relatively flat over the next two policy meetings. BOJ-dated OIS does not fully price a 25bp hike until July 2026.
- Against this backdrop, it remains to be seen whether the current 10-year yield level will be sufficient to maintain strong demand in today's auction.
- Results are due at 0335 GMT / 1235 JT.
JGBS AUCTION: PREVIEW - 10-Year JGB Auction Due
The Japanese Ministry of Finance (MoF) will today sell Y2.6tn of 10-year JGBs. The MoF last sold 10-year debt on 2 December 2025. The auction drew cover of 3.5913x at an average yield of 1.872%, an average price of 98.57, a high yield of 1.877%, a low price of 98.53, with 21.1502% of bids allotted at the high yield.
- Last month, the 10-year auction saw stronger demand than its 12-month average. The bid-to-cover ratio was stronger vs 2.97x at the prior auction, with a tail of 0.04 vs 0.13 for prior sale. Cut-off price was 98.53 vs 98.50 in a Bloomberg survey.
- Results are due at 0335 GMT / 1235 JT.
