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Bangkok - Thailand's currency slumped to a six-year low on Tuesday and shares fell in Bangkok over concerns an unprecedented attack in the capital could hit the vital tourism sector.
At least 20 people were killed and over 120 wounded when a bomb ripped through a Bangkok religious shrine late Monday, in what authorities said was the worst ever attack on Thai soil and targeted at foreigners.
The baht fell as much as 0.8% to 35.648 against the dollar on Tuesday, touching its lowest point since April 2009. It closed at 35.556.
Bangkok shares slumped as much as 2.8% in opening deals, their steepest decline this year. The market ended down 2.56% or 36.13 points at 1 372.61.
Tourism-linked companies led the sell-off, with Airports of Thailand plunging 6.62% while Central Plaza Hotel tumbled 10.60%.
"Thailand is vulnerable right now as economic growth and corporate earnings are weak, while tourism is not doing great," Andrew Stotz, CEO of Bangkok-based Stotz Investment Research, told Bloomberg News.
The timing of the blast just as "we're coming into this high tourism season" means it could be particularly damaging to the sector, which accounts for 8.5% of GDP, he added.
Chinese, Hong Kong, Singaporean, Indonesian and Malaysian citizens were among those killed in the attack on the Erawan shrine in the heart of Bangkok's tourist and commercial centre.
Morgan Stanley said big-spending Chinese tourists - whose numbers have soared in recent years, bucking a general downtrend - are particularly likely to be put off by the unrest.
Last year around 4.6 million Chinese nationals visited the kingdom, with the average tourist spending 5 500 baht ($155) per day, more than the average European visitor.
The attack comes after Thailand's economy slowed in the second quarter, hit by weak domestic demand and exports, with growth expected to be hampered this year by China's devaluation of the yuan.
Gross domestic product grew 2.8% between April and June compared to a year earlier, official data showed Monday, slowing from three percent in the previous quarter.
Hours before the blast, Thailand's planning board trimmed its 2015 growth forecast to 2.7-3.2%, down from 3.0-4.0%.
It also warned growth faces "major constraints" after China devalued the yuan last week, sparking fears of a currency war in Asia.
The Thai baht is among several Asia-Pacific currencies that have slumped since the yuan cut, suffering their worst two-day sell-off since the Asian financial crisis last week.
