Thailand’s central bank has stepped in to slow the sharp appreciation of the baht, which reached its strongest level in four years. Assistant Governor Chayawadee Chai-anant said the bank is monitoring foreign exchange movements closely and using reserves to manage volatility.
The baht traded at around 31.87 per dollar on Friday, gaining nearly 8% this year, making it Asia’s second-best performing currency after the Taiwan dollar. Officials warned that the currency’s strength could weigh on exports and tourism, both vital sectors for Thailand’s economy.
Chayawadee noted that the baht’s surge has been supported by a weaker U.S. dollar, a current account surplus, gold trading, and improved political clarity following the formation of a new government. The bank is considering ways to ease pressure on the currency, including encouraging gold transactions in U.S. dollars, though a gold tax is not currently planned.