Thai finance minister sees nothing wrong with capital inflow

BANGKOK, Mar 27 (TNA) – Thailand's Finance Minister Korn Chatikavanij on Friday indicated foreign capital continued flowing into Thailand and that he had not yet seen anything wrong regarding the capital inflow.

Mr Korn said the country’s exports had picked up, resulting in an increase in the current account surplus.

Although the baht had strengthened somewhat, it had not placed Thailand at a disadvantage with neighboring countries such as Malaysia and Indonesia in terms of competitiveness.

He said the volume of foreign capital inflow in the Thai stock market early this year was close to the foreign capital outflow in the last four months of 2009.

Normally, Mr. Korn conceded, funds from countries with low interest rates would flow into countries with higher interest rates for gains in the interest spread.

However, there was no problem with the current foreign capital inflow, he said, and local interest rates remain low. An interest hike would not have a significant impact because there is excess liquidity in the system.

The Bank of Thailand is responsible for its management because it must monitor overseas inflation rates as well. (TNA)