Thailand: Thai Baht Strengthening Linked To Overseas Capital Inflow

According to Bank of Thailand Deputy GovernorBandid Nijathaworn, the Thai baht has strengthened considerably in line with other regional currencies, particularly Japanese yen. BOT attributes this to the inflow of foreign capital. Nijathaworn further said that the appreciation in the baht since early this year is because other regional currencies, especially the Yen, had strengthened significantly. Other factors include the foreign capital inflow into the stock exchange of Thailand. BOT plans to supervise the baht's movements to ensure that the domestic currency is neither too volatile nor excessively strong. Najathaworn asked investors to exercise caution in investing in the Thai stock market, as he was uncertain whether the foreign capital had flown in the country was for short-term or not. Nijathaworn conceded that the central bank could not determine the proper level of baht. SET's PresidentKittirat Na Ranongsaid the strengthening of the Thai baht showed that the country had enjoyed a steady economic growth. Ranong expects that the baht would continue to appreciate in the long run.