Shares of the iShares MSCI Thailand Capped Investable Market Index Fund (NYSEArca: THD) are lower by nearly 2% Wednesday after the Bank of Thailand disappointed markets with an interest rate cut of 25 basis points to 2.5% during Wednesday’s Asian session. While the interest rate reduction was widely expected, some market participants were hoping for a cut of 50 basis points.

Dejected traders are making their feelings known Wednesday and have sent THD, one of the top-performing emerging markets ETFs for most of 2013, below $90 for the first time in five weeks. Including Wednesday’s tumble, THD is now down about 4.3% in the past month. [Southeast Asian ETFs Heat Up]

Bank of Thailand’s Monetary Policy Committee voted unanimously to cut the one-day repo rate to 2.50% from 2.75%, the central bank’s first interest rate reduction since October 2012. After the Southeast Asian nation posted first-quarter GDP growth of just 2.2%, rate cut chatter increased with some investors clamoring for a deeper cut as a means of weakening the baht, Thailand’s currency. Slack growth in the first quarter is in part attributable to the baht’s rise against the U.S. dollar, which has hampered Thai exporters.

THD is not excessively exposed to the country’s export story with domestically-focused industries such as financial services, telecommunications and staples combining for about 56% of the ETF’s weight. However, the baht’s 6% year-to-date rise against the dollar has recently shown signs of weighing on THD, an ETF that previously held up well relative to the broader emerging markets universe. [Four Country ETFs Bucking The Downtrend]

Still, disappointments are disappointments and the combination of an export-driven and a strong currency could portend further rate cuts by the Bank of Thailand. “Finance Minister Kittiratt Na-Ranong in recent months has pressed repeatedly for sharper interest rate cuts to take some of the heat out of the Thai baht’s ascent at a time when other countries such as Japan, South Korea and Vietnam are loosening monetary policy,” reported Nopparat Chaichalearmmongkol for the Wall Street Journal.