The Bank of Thailand (BoT) has intervened in the foreign exchange market after the baht declined 0.5% to 31.08 per dollar on Thursday morning.
Kittiratt Na-Ranong, left, and Prasarn Trairatvorakul (Photo by Apichart Jinakul)
Central Bank governor Prasarn Trairatvorakul said the baht's recent depreciation is not worrying because other currencies in Southeast Asia have also weakened. The level of fluctuation of the baht is low when compared to other regional currencies.
"In this case, the BoT has already sold some US dollars to prevent further fluctuation, but we won't move against the market trend," Mr Prasarn said.
He said the Thai stock market plunged more than 70 points on Thursday morning. This was likely due to the sharp sell-off in the bourse as investors expect the US economy to improve.
"The capital outflow is not yet worrying because the amount is not much when compared to the reserves of 180 billion dollars," the BoT chief said. "We cannot tell when the outflow stops because it's an external factor."
Finance Minister Kittiratt Na-Ranong said the weakening baht will benefit Thai exporters but will likely hurt the import sector.
"I would like the central bank to help stabilise the baht by using our large international reserves as a buffer to ease the impact (on importers) and keep the currency stable and in line with our trading partners and competitors, and not just rely on the US dollar," Mr Kittiratt said.