The Bank of Thailand saw a need to preserve limited monetary policy room to use at the most effective time when it kept its benchmark rate steady at a record low last month, according to minutes of its policy meeting published on Wednesday.
On Nov 18, the BoT's monetary policy committee voted unanimously to leave the one-day repurchase rate at a record low of 0.50% for a fourth straight meeting after three cuts earlier this year to support a coronavirus-hit economy.
The committee was worried about the rapid rise in the baht , and would consider necessary measures "to ensure that the exchange rate movements would not be an obstacle to economic recovery", the minutes said.
"The rapid appreciation of the baht would affect the fragile economic recovery through eroding profitability of exporters that would in turn affect investment and employment," the minutes said.
The baht traded at 30.22 per US dollar at 10.45am on Wednesday, after hitting a more than 10-month high of 30.13 last month.
Risks to the economy remained and could arise from factors including political uncertainties, while the gradual and uneven recovery could impact financial stability, the minutes said.
Southeast Asia's second-largest economy shrank a less than expected 6.4% in the third quarter from a year earlier after the second quarter's 12.1% slump.The BoT forecast the economy would shrink a record 7.8% this year and will review this at its next policy meeting on Dec 23.
For the full minutes click here.