Central bank blames rapidly weakening dollar for stronger baht
The weakening dollar has seen regional currencies appreciate quickly, with China’s yuan its highest for two and half years, the Korean won and Singaporean dollar strongest in three years, and the new Taiwan dollar at a 23-year high.
Availability of Covid-19 vaccine coupled with signs of global economic recovery in November have caused the US dollar to weaken rapidly, Bank of Thailand (BOT) assistant governor Vachira Arromdee said on Wednesday. The dollar fell to a two-year low against the baht of Bt30.023 on Wednesday, according to BOT figures.Since November, the baht has risen 3.5 per cent, the won 4.5 per cent and Indonesia’s rupiah 3.9 per cent.
Year-to-date, the baht had actually weakened slightly, Vachira noted.
The central bank was closely monitoring currency rates and it would prevent the baht’s value from impacting the economic recovery, she added.
The central bank has introduced a slew of measures to encourage capital outflow in order to balance increasing capital inflows that are driving the baht up.
Thai exporters are complaining that the strong baht makes their products more expensive and less competitive in the global market.