Thai Baht Rallies to 6-Years High | Wibestbroker

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Wibest – Thai: Thai baht coins and notes.

 

The Thai baht to US dollar exchange rate climb to records high after news from the Bank of Thailand’s September meeting minutes. Worries about economic growth pushed the Bank of Thailand to consider new stimulus measures.

According to news, the bank is thinking of ways to rein in the baht to levels last seen six years ago.

The THB USD trading pair rallied 0.53% or 0.0002 points in today’s session. A single Thai baht currently trades for 0.0330, inching higher from its previous close of $0.0328.

The minutes from the Bank of Thailand’s Monetary Policy Committee on September 25 supported the baht in sessions.

According to reports, the MPC said that the Thai economy is more sensitive to greater currency appreciation. It said that there will be additional pressure on domestic demand, specifically on the manufacturing and services sectors.

In July, the Monetary Policy Committee curbed the nation’s short-term inflows. The Bank of Thailand then worried about the baht’s strength, which could hinder the export-reliant economy.

The news was enough for the Thai baht to gain in sessions, pushing the greenback into losing ends. The THB is also the best performing currency in Asia as it gained 7.4% against the USD this year.

Hold on to Gains

Wibest – Thai: A close up of a Thai baht bill.

The Bank of Thailand is planning new currency measures including relaxing capital outflow regulations. According to the central bank, the move aims to encourage Thai businessmen to widen their investment portfolio abroad.

Aside from that, it is also considering collaboration measures with other organizations to stimulate investment in the country.

In August the bank reduced the benchmark interest rate by 1.5% and left it unchanged in September.  The MPC says that they saw the need to preserve it to cushion the risks in the future.

Thai policymakers are also monitoring the impacts of the policy rate and the fiscal stimulus measures on the economy. Monitoring the growth, inflation and financial stability risks in the country will help officials think ways to preserve the baht’s gains.

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