BoT to lower THB to back export sector

BANGKOK, 26 January 2011 (NNT) – The Bank of Thailand (BoT) this year will implement monetary policies that are more favorable to the weakening of the baht currency in an effort to help the export sector.

BoT Board Chairperson MR Chatu Mongol Sonakul stated that some signs of depreciation in the Thai baht could be seen at present, which would benefit national exports. According to him, the BoT has adjusted its policy on baht intervention in order to facilitate the export sector which has greater purchasing power than domestic spending sector.

MR Chatu Mongol continued that the expansion in national exports would also help increase employments and income of employees in the country, which would then help support the national economy to expand on a continuous basis.

The BoT board chairperson however admitted that the weakening baht currency would affect the inflation rate in addition to other existing factors. He said the Monetary Policy Committee would monitor the issue while the BoT would use monetary policies to keep the inflation rate down.

MR Chatu Mongol explained that the BoT might have to increase the policy interest rate further in a bid to control the inflation because low inflation could support the national economic growth better than a high inflation rate.

The chairperson then voiced his concerns over political uncertainties and frequent political demonstrations, branding them as another major risk factor for the Thai economy this year.