Thai Central Bank, Gold Traders Collaborate to Curb Baht's Surge

 

The Bank of Thailand (BOT) has held talks with the Gold Traders Association to address the impact of gold trading on the country's currency, following a sharp appreciation of the baht.

The currency has surged by more than 7 per cent since the beginning of the year, making it the strongest-performing currency in the region.

The baht's strength is attributed to a larger-than-expected current account surplus and a sustained increase in global gold prices.

 

Pimpan Charoenkwan, assistant governor for the BOT’s Financial Markets Group, confirmed that a meeting with the Gold Traders Association was held today to discuss ways to mitigate the currency's pressure.

 

 

The association proposed a strategy to encourage more gold transactions in Thailand to be conducted in US dollars.

 

The central bank has also urged gold shop operators to step up their monitoring of gold trading in baht, with a focus on investor behaviour that could influence the currency's value. Furthermore, the BOT requested traders to be vigilant and ensure that no transactions are linked to illegal activities.

 

 

 

The BOT confirmed it has received the feedback and asked the Gold Traders Association and its members to prepare a formal proposal detailing further measures to help alleviate pressure on the currency. This will inform future actions by relevant authorities to ensure they are both effective and targeted.