BoT chief downplays concerns over stern measures to contain baht surge

BANGKOK, Sept 16 – Bank of Thailand (BoT) Governor Tarisa Watanagase on Wednesday downplayed mounting investor concerns that the central bank would impose stern measures to contain the stronger baht, saying the matter is just an expectation.

She conceded that the Monetary Policy Committee (MPC) did hold a special meeting on September 10 and that the officials convened provided the latest information on the baht appreciation.

The meeting led to the expectation that the central bank would response firmly to the baht surge.

She said the policy adopted by the central bank to oversee the baht remains unchanged, and that the MPC agreed with actions the bank has taken.

Mrs Tarisa affirmed that the bank would not peg the currency exchange rate. What it would do is to supervise the baht to ensure it is not too volatile.

She attributed the continued baht appreciation to both internal and external factors.

Externally, the Asian economy is stronger than the United States, European, and Japanese economies, resulting in foreign capital flowing into the region.

Internally, the political disturbances in Thailand, which culminated in April and May this year, had eased, causing the foreign capital influx into the country.

Regarding an approach to helping small- and medium-size enterprises (SMEs) affected by the stronger baht, she said the central bank had discussed with members of this business sectors regarding their problems and is committed to find a way to help them.

She allowed that some SMEs lacked liquidity and were unable to place deposits as a hedge against currency exchange risks.

However, Mrs Tarisa said she believed, the Export and Import Bank of Thailand (EXIM) would be able to handle the problem. (MCOT online news)