Ella 
USD/THB fell sharply on Tuesday, facing a mix of a strong U.S. economy and a cautious stance from the Federal Reserve (Fed). The U.S. Producer Price Index (PPI) showed no surprises, and the market is preparing for Wednesday’s U.S. Consumer Price Index (CPI) report.
In terms of U.S. data, the U.S. producer price index (PPI) in April was at an annual rate of 2.2%, in line with market expectations, and the U.S. economy remains resilient. Despite the strength in those indicators, caution prevailed as Federal Reserve Chairman Jerome Powell remained wary of inflationary trends and stressed the need to commit that interest rates may need to remain higher for longer. Markets are betting the Fed will start cutting interest rates in September, with a November rate cut already a certainty. However, inflation data could change that possibility.
