Publication date: September 30, 2024 17:17
A worker collects rubber sap from a tree at a plantation in Isan, Thailand, on September 24, 2024. A rapid appreciation of the baht is hurting exporters and tourism spending, the central bank said on Monday. (Bloomberg Photo)
rapid thanks Thai Baht Exporters and tourism spending have been hit, the central bank said on Monday, adding that the weaker currency was strengthening the currency. dollar In the face of the appreciation of regional currencies such as the yuan and yen.
The baht hit a 31-month high against the dollar on Monday at 32.235 baht. Year-to-date, it has risen 5.8%, making it the second-best performer in the region after Malaysia's ringgit.
Exports and tourism are the main drivers of Southeast Asia's second-largest economy.
The rapid appreciation in the baht comes ahead of a meeting between the central bank and the finance ministry this week, where they are expected to discuss the baht's performance and the country's inflation target.
The meeting, first reported by Reuters, followed months of government pressure on the Bank of Thailand (BoT) to lower interest rates and align fiscal policy with the aim of stimulating the economy.
The central bank has resisted calls to cut interest rates, keeping interest rates unchanged at 2.50% for the fifth time in a row at last month's meeting, but said a cut was not necessary. The next interest rate review is October 16th.
Chayawadee Chaianan, assistant central bank governor, told reporters that the central bank had managed the baht's fluctuations.
He added that the strong baht is affecting exporters when converting their profits into baht, which will also affect tourism spending.
According to the central bank, exports in August increased by 11.4% compared to the same month last year, and imports increased by 8.5%, resulting in a trade surplus of $2.4 billion.
The central bank said the current account balance had a surplus of $1.4 billion in August, up from a revised surplus of $100 million in July, due to an acceleration in agricultural exports to trading partners facing shortages.
Economic growth accelerated to 2.3% in the April-June period from a year earlier, but analysts said fiscal policy uncertainty clouded the outlook.
The central bank forecasts economic growth of 2.6% in 2024, following last year's 1.9% growth, lagging behind regional countries.
