ID :
146034
Wed, 10/13/2010 - 20:18
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https://oananews.org//node/146034
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Central bank: More measures may be needed to rein in baht rise
BANGKOK, Oct 13 - In response to the Cabinet’a approval of measures to curb the strong baht, Bank of Thailand (BoT) Governor Prasarn Trairatvorakul said Wednesday tht the measures will help slow down foreign capital inflows but additional measures may be needed later.
It will take some time to realise how effective the measures are, Mr Prasarn said.
Since there was no clear stance from the major economies to solve the problem during the recent World Bank and International Monetary Fund (IMF) meetings, he said, what should be done now is to ease adverse impacts from the influx of capital inflows by effective management of the floating exchange rate.
Economies of industrial countries expand slightly while new economic countries have high growth rates, so it has caused capital movement to seek higher profits, the BoT governor said.
Meanwhile, Suchada Kirakul, assistant governor for the BoT Financial Markets Operations Group said the government will continue monitoring the baht's appreciation as the measures introduced to ease the impact of the baht strengthening are simply the first step. More measures may be considered to counter excessive baht speculation.
The government’s measures to curb strong baht are believed to help slow capital inflows. The measure to reimpose the 15 per cent withholding tax on interest and capital gains earned from bonds by foreign investors which took effect today are aimed to discourage foreign investors, the BoT executive said.
She added that the volatility of the Thai unit stems from several factors including euro and dollar movements and speculation on the American quantitative easing to be issued to stimulate its own economy.
Cabinet on Tuesday approved measures to slow capital inflows and boost capital outflows to counter the baht rise as well as to help small- and medium enterprise (SME) exporters which are subject to be affected by the strong baht.
The baht recently hit a 13 year high, posing risks to Thailand’s exports. (MCOT online news)
It will take some time to realise how effective the measures are, Mr Prasarn said.
Since there was no clear stance from the major economies to solve the problem during the recent World Bank and International Monetary Fund (IMF) meetings, he said, what should be done now is to ease adverse impacts from the influx of capital inflows by effective management of the floating exchange rate.
Economies of industrial countries expand slightly while new economic countries have high growth rates, so it has caused capital movement to seek higher profits, the BoT governor said.
Meanwhile, Suchada Kirakul, assistant governor for the BoT Financial Markets Operations Group said the government will continue monitoring the baht's appreciation as the measures introduced to ease the impact of the baht strengthening are simply the first step. More measures may be considered to counter excessive baht speculation.
The government’s measures to curb strong baht are believed to help slow capital inflows. The measure to reimpose the 15 per cent withholding tax on interest and capital gains earned from bonds by foreign investors which took effect today are aimed to discourage foreign investors, the BoT executive said.
She added that the volatility of the Thai unit stems from several factors including euro and dollar movements and speculation on the American quantitative easing to be issued to stimulate its own economy.
Cabinet on Tuesday approved measures to slow capital inflows and boost capital outflows to counter the baht rise as well as to help small- and medium enterprise (SME) exporters which are subject to be affected by the strong baht.
The baht recently hit a 13 year high, posing risks to Thailand’s exports. (MCOT online news)
