BANGKOK, 15 July 2014 – The Bank of Thailand (BOT) has revealed that the Thai baht gained 1.3 percent during the first half of this year, while the outflow by foreign investors was valued at about US 3 billion dollars.
Chantawan Sucharitkul, BOT Assistant Governor, noted that Thai baht moved in line with other regional currencies and the global economy during the first half of this year.
At the beginning of the year, the Thai baht was weaker due to the political crisis before becoming stronger in February. Later the Thai baht became weaker again in May. Then, from May 22 onwards, after the military took power, the baht has been strong due to the more stable political situation.
Besides, the flow of foreign investors’ funds returned in June. The Thai bourse has gained 14.4 percent since the end of last year. Foreign investors sold 41 billion baht in the Thai stock market. Foreign investors sold 42 billion baht in the bond market, and now holds bonds accounting for 9.7 %, a 10.34 % decline since the end of the previous year. In addition, yields of government bonds decreased 17-34 bps due to the economic slowdown.
Meanwhile, from the BOT’s point of view, the Thai baht is moving in an acceptable range, not fluctuating too much. Economic recovery and progress in forming a government will be positive for the Thai baht. As for moves to make the Yuan a major global currency, the BOT considers that it will be beneficial for Thai entrepreneurs engaged in border trade with China. As well, BOT diversifies its reserves in various currencies. So, it should not affect the Thai baht.
