Govt bullish on benefits of weakening baht
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The government has expressed its opitimism that the export target this year would be achieved thanks to the recent depreciation in the Thai baht as well as a slight improvement the euro zone economy.
Government Spokesperson Dr Yongyuth Mayalarp told reporters that the Bank of Thailand's recent measures are positive to the export sector, as this should boost the competitiveness and ensure that the Commerce Ministry's 1.2 per cent export target would be achieved.
He also noted that another good news came from the European Commission's upward revision in the European Union economic growth in 2015 from 1.7 per cent to 1.8 per cent, following monetary easing measures.
The higher economic growth rate should boost demand for Thai exports, he said, adding that 9 per cent of Thai exports is destined to the bloc.
The baht lost more than 1 per cent to 33.43 per dollar on Thursday, its weakest since January 2010.
Last week, the central bank made a surprise cut to the policy rate. It also eased capital account restrictions to facilitate cross-border capital flows.
Bank of Thailand Governor Prasarn Trairatvorakul on Thursday attributed the weakening to several factors, including the rate cut, the easing of the capital account restrictions as well as the improvement in some US economic indicators.
He is convinced that the weakening baht would support Thailand's economic recovery, citing that the first-quarter growth was slower than expected due mainly to export contraction.
Yet, he insisted that no more measures are planned to further weaken the Thai baht against US dollar.
