The baht dropped to the lowest level in five years after the Bank of Thailand sent a strong signal it wanted the weaker currency to help spur exports.
KResearch managing director Charl Kengchon said the local currency on Wednesday traded at 33.30/32 against the US dollar, the lowest level since early 2010. Last week, it fetched 32.94/98 against the greenback.
The central bank cut the benchmark interest rate by 25 basis points to 1.75% in March. It made the second cut in late April to 1.50% as the economy remained in the doldrums.
The second reduction came after the Finance Ministry reduced its growth forecast for this year to 3.7% from an earlier estimate of 3.9% on a slump in exports and domestic consumption.
The current-account surplus shrank to $2.22 billion in March, from $3.5 billion in February, data showed on April 30.
"The central bank's easing of curbs on fund outflows last week further weakened the baht," Mr Charl said.
A day after the second rate cut, the central bank raised limits on foreign-currency deposits at domestic banks and on overseas property investments.
It also allows local investors to invest directly overseas and non-residents will be able to borrow more baht from local banks.
Analysts interpreted the BoT's moves as a strong signal it would keep the baht weak so Thai exports will be more competitive.
The earlier cut had failed to achieve that.
"Lack of interest was the reason for the baht remaining stable," Nizam Idris, head of strategy, fixed income and currencies at Macquarie told CNBC. "No one was selling," in part because the capital controls made shorting the currency expensive, he noted. "The floodgates have finally been opened."
Mr Charl expected the baht to trade in a range between 33.00/40 to the greenback from May 6-8.