According to information from the Bank of Thailand During the beginning of that year
The US dollar was up 18.4%.
The yen weakened 20.3%.
Pound fell 19.8%.
Won weakened by 16.4%.
The peso weakened 13.6%.
The Taiwan dollar weakened 12.6%.
The baht depreciated by 12.1%.
Mr. Piti Disayatat, Assistant Governor Monetary Policy Group Bank of Thailand (BOT) said that the depreciation of the currency in the past. Has not affected the economy and inflation as a whole. due to the depreciation of the baht This is the appreciation of the US dollar.
The main reason is because the US Federal Reserve (Fed) raised the policy rate very quickly and strongly. Since the beginning of the year, the US dollar has gained 18%.
“The appreciation of the US dollar Considered to have risen to an unprecedented increase Almost every country in the world has a weaker currency. compared to the US dollar
Therefore, the weakening of the baht is not the only factor for the Thai economy. and if you look at the depreciation of the baht only in the Asian region The baht is still in the middle level, having weakened 12% since the beginning of the year, depreciating less than Taiwan, the Philippines, Japan and Korea,” Ms. Piti said.
But the MPC said the currency issue is something that needs to be closely monitored. because during high volatility
The Committee recognizes that the ability of monetary policy and tools available In order to maintain the strength of the US dollar, “limited”
Asked if the US dollar strengthened once more. What can Thailand do?
Khun Piti admits that “I probably won’t be able to do much.”
and added, “If you have to do it, you need something strong.”
Even though Thailand has raised interest rates by only 0.25%, our currency has depreciated by 12%.
But there are many countries, such as New Zealand, the Philippines, Korea, have raised interest rates a lot more than Thailand, ranging from 1-2%, their currency once morest the dollar is still weaker than Thailand.
It shows that interest is a limitation on how much you can handle once morest the dollar.
Because in the end, the change in the currency is mainly regarding the strong dollar.
Are there concerns regarding capital outflows from the country?
Bank of Thailand officials said From the beginning of the year to the present, net capital flows into Thailand remain positive. by entering a large number of stock investment systems
Therefore, it is believed that Thailand has no problems with capital flows and outflows. because investors still see the potential of Thailand because Thai stability is still strong
Existing foreign reserves when compared with the GDP ratio Thailand ranks 6th in the world and Thai debt abroad is relatively small. compared to the amount of reserves with a reserve amount of 3 times the short-term liabilities
in the business sector The depreciation of the baht also helped some exporters.
But the concern is import cost As a result, importers have to pay higher in Thai baht.
Overall, the Thai economy is likely to recover continuously. This is mainly due to the power of the tourism sector and private consumption.
Headline inflation remained high due to the recent increase in pass costs. Although supply pressures from commodity prices are likely to ease
The Thai economy is likely to expand continuously at 3.3 and 3.8 percent in 2022 and 2023, respectively.
This is mainly due to the power of the tourism sector and private consumption.
The tourism sector recovered better than expected. due to the continuous increase in the number of foreign tourists
In addition, the economic recovery is more thorough. both in the dimensions of the business field especially in the service sector and in the dimension of income that began to spread better
while the world economy slows down expected to affect the export sector But it does not affect the overall economic recovery trend.
Headline inflation in 2022 and 2023 is expected to be 6.3 and 2.6 percent, respectively.
with a downward trend in line with world oil prices. and the problem of supply chain that gradually unraveled
while core inflation in 2022 and 2023 is expected to be at 2.6 and 2.4 percent, respectively.
Labor wages have increased in some business sectors and some areas with labor shortages. But we haven’t seen any signs of a broad increase. Demand-side inflation pressures remain limited. Because the Thai economy is still recovering.
The Bank of Thailand said the overall financial system was stable. Commercial banks have strong capital and reserve levels. Debt serviceability of businesses and households improved in line with economic recovery.
But there are still SMEs in some business sectors that recover slowly. and some low-income households who are still sensitive to the cost of living
The Board is of the opinion that debt restructuring measures should be continued. It also recognizes the importance of having specific measures and sustainable solutions to debt problems for vulnerable groups.
interesting is A statement that if the future economic and inflation outlook changes from the forecast The board is ready to “Adjust the size and timing” of the policy rate hike to be appropriate.
That means everything is still in a state of high uncertainty… and many factors linked to international conflict are beyond Thailand’s control.
As for being ready to use “strong medicine”, no one can tell how “strong” it is to be called “strong enough”!.