The Thai baht's strength raises concerns over the slowdown in the Thai economy

The Thai baht has soared against the US dollar this year, far more than many other emerging market currencies.

This strength, however, raises concerns about the weakening of the country's national economy, badysts said.

Since the beginning of the year, the Thai currency has jumped more than 5% against the dollar. Year on year, it has even increased – almost 8%.

The other top-performing emerging market currencies in the region also strengthened against the dollar, but lagged the baht. For example, the Indonesian rupiah and the Philippine peso, for example, have risen more than 3% against the dollar since the beginning of the year.

"Thai policymakers and exporters are once again worried about the strength of the baht," wrote Gareth Leather, chief economist for Asia at the research firm Capital Economics, in a note earlier that month. "While most currencies (emerging markets) have appreciated against the US dollar in recent months, none has increased as much as the baht."

The strength of the baht was supported by Thailand's large trade surplus and a warmongering central bank, among other factors.

"(The) strong currency aggravates the critical situation of the (Thai) economy by further hindering exports," CNBC Prakash Sakpal, an economist for Asia at the Dutch bank ING, told CNBC.

A stronger currency makes the country's exports more expensive, making them less attractive in international markets.

Analysts at Singaporean bank DBS said Monday that the strength of the baht was bad news for Thailand's trade competitiveness. They cited a study by the Bank of Thailand that showed that for every 1%, the baht strengthened against the dollar increased export prices – in dollars – by 0.3%.

Meanwhile, exports are already down. They fell for the third consecutive month in May, down 5.79% from the previous year. It was worse than the 3.6% drop that badysts had projected in a Reuters poll.

On Tuesday, the data indicated that the country's manufacturing output for June was moving in the same direction: it dropped 5.54% from the previous year, which was worse than the forecast of a decline of 3.15%.

"Given these weak trade patterns and difficult prospects for regional growth … a strong currency is coming at an inconvenient time," DBS badysts wrote, citing slowing exports and imports, as well tourism.

Economists have said the country's central bank could yield to pressure and cut rates to curb the rise in the baht. Nevertheless, they were not optimistic about the effectiveness of such a measure.

"The (Bank of Thailand) could consider lowering rates to help reduce the baht's attractiveness to yield, but it will not be a panacea," DBS badysts said in their note, adding that A 25 basis point reduction would simply cancel a rise in interest rates. central bank last December.

Similarly, ING's Sakpal said that any reduction would only yield limited results.

"Even if it should curb some of the upward pressure, we may not see the baht moving for the moment as the most successful emerging currency," he said.