The Thai baht rose to a six-year high against the dollar in Wednesday trading, hitting 37.10 after rising from 37.23 when the market opened.

The dollar fell from $1.260 against the euro to $1.263, with analysts predicting $1.30 by the end of the year, and to 118.82 yen, down from 119.13.

Thai traders said that the baht rise was due to higher capital inflows at the national stock exchange while the dollar weakened against a basket of other currencies.

Other regional currencies followed the trend, with the Chinese yuan rising to its highest level since decoupling from the US currency in July 2005, hitting 7.98 against the dollar.

The region also benefited from a general movement among traders to buy currency while offloading dollars.

The Thailand Central Bank has not yet said whether it will intervene in the currency.

Analysts said that the baht required careful monitoring through the year end as recent flooding would hit agriculture and have an effect on exports.