Suttinee Yuvejwattana, Haslinda Amin (Bloomberg, 11/30/20); Seth Auberon, Wisdom Quarterly
Thailand likely to act again on baht, finance minister says
[The American dollar is weak.] Recent measures from the Bank of Thailand that aim to restrain the surging baht [the Thai dollar] will likely be followed by “further strict” steps.
But policy makers are unlikely to impose outright capital controls, Thai Finance Minister Arkhom Termpittayapaisith said.
“I think that’s only the first step,” F.M. Arkhom told Bloomberg Television, referring to the Bank of Thailand’s Nov. 20 [2020] move to ease rules on capital outflows.
“I’m sure the central bank will do more measures on that.”
Currency strength has re-emerged as a key issue for the Thai government after the baht reached a 10-month high against the U.S. dollar in November [2020], raising concerns about the impact on exports.
Thailand’s economy is expected to contract the most in more than two decades this year with tourism in limbo amid the pandemic.
Urged by exporters and policy makers to stem the baht rally, the central bank announced plans to relax capital outflow rules and more closely scrutinize investment into bonds. So far the measures have failed to cool the currency.
The baht was 0.1% lower at 30.285 to a dollar by 8:50 am local time, paring gains this quarter to 4.6%. More
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