BoT gets greenlight to curb baht's appreciation | Bangkok Post: news

Prime Minister Abhisit Vejjajiva said on Thursday he had given the Bank of Thailand guidelines for introducing measures to curb the value of the Thai baht, if necessary.

“I have told the central bank that it can take measures to control the foreign direct investment inflow and outflow to prevent the baht from fluctuating too heavily," said Mr Abhisit.It was possible that the currency would continue to strengthen, but he could not say whether it would reach 29 baht to the US dollar, as speculated.The chairman of the House finance, banking and financial institutions committee, Puea Thai MP for Chiang Mai Surapong Towichakchaikul, on Thursday afternoon called on the government to oversee the baht’s value.Mr Surapong said the baht reached 30.85 baht to the US dollar today.He warned that if no action was taken, the export sector would be severely affected in the fourth quarter of the year.The committee chairman called on Prime Minister Abhisit and Finance Minister Korn Chatikavanij to clearly state what measures would be applied.Bank of Thailand assistant governor Paiboon Kittisrikangwan said the baht’s rise in value has no impact on the economic stability and growth potential.Mr Paiboon said even though the Thai currency continues to strengthen, it will not lead to economic instability or a deterioration of growth as the central bank is capable of managing its value.He said the BoT is duty-bound to ensure that any change in value of the baht would not have an adverse effect on the Thai economy, both short-term and long-term.The central bank will keep a close watch and will assess the impact of the strong baht on the economy, and take into account all related factors.“The BoT will focus on stability of the economy by assessing whether the economy can continue to grow under the changing factors, including changes in the global monetary market and foreign exchange rates,” said Mr Paiboon.Earlier today, Thanawat Polwichai, director of the Economic and Business Forecasting Centre at the University of the Thai Chamber of Commerce, called on the central bank to clearly make known how it would oversee the baht's value.“The BoT should tell the...