BANGKOK,Thailand’s central bank was in the foreign currency market to reduce currency volatility. This statement came as the Thai baht currency hovered around 16-year lows against USD.
According to the central bank, the dollar strength has driven the baht’s 11.7% fall against the dollar in the baht this year.
Mathee Supapongse, Deputy Bank of Thailand Governor, said that the baht index has been stable against other currencies, but that the country’s foreign position and banking system remain strong.
He said that “We’ve entered market occasionally to slow down volatility in the baht”, adding that the BOT did not have a target for baht levels.
He said that the fall in Thailand’s international reserve was not due to currency intervention, but asset valuations.
Mathee stated that despite the wide rate differentials between Thailand and the United States, Thailand has attracted capital flows.
Foreign investors have purchased Thai shares worth 150 billion baht (or $3.97 billion) so far this year, but bonds worth 33 billion baht have been sold.
Governor Sethaput Suthiwartnarueput stated that a gradual and measured approach to policy tightening is appropriate to support Thailand’s slow economic recovery. However, he was open to adjusting if necessary.
To control inflation at its 14-year high, the BOT increased its key interest rate by quarter point to 1.0% on Wednesday.
($1 = 37.77 baht)
