Auto Added by WPeMatico

THAILAND’S central bank said it still has scope to manage the baht even after the US added the country to a monitoring list for potential currency manipulators.
Bank of Thailand Assistant Governor Chayawadee Chai-Anant told reporters Friday in Bangkok that “it may be quite difficult” for Thailand to be designated as a currency manipulator, and that the central bank has maintained regular communication with the US Treasury.
Her comments followed the US’s decision to place Thailand on its list of “major trading partners whose currency practices and macroeconomic policies merit close attention.”
Thailand met the criteria because of its trade and current-account surpluses, Chayawadee said, adding that the bank still retains the ability to curb excessive foreign-exchange volatility.
“According to the US Treasury, Thailand’s approach to foreign exchange intervention since 2021 has indeed been broadly symmetrical, with the Bank of Thailand entering the market to resist sharp swings in both depreciation and appreciation pressures,” Rohit Garg, a strategist at Citigroup Inc. wrote in a note to clients. “This should help reduce the focus on BoT’s FX interventions for the time being.”
Gold Trading
Separately, the Bank of Thailand said it’s tightening rules for online gold trading to curb speculative activity that can amplify swings in the baht.
The move comes as rising gold prices and a weaker dollar have spurred gold selling by Thai investors, boosting foreign-currency inflows and adding upward pressure on the currency.
Under the new rules, effective March 1, online platforms will face stricter settlement and reporting requirements, including bans on net settlement and short selling. Investors will be required to sell only gold they physically own, transactions must be settled electronically, and cash payments will be prohibited.
The central bank said the measures are aimed at improving transparency, ensuring trades are backed by real assets and limiting risks to financial stability.
Starting March 1, the bank will also cap baht-denominated online gold trading at 50 million baht a day. —BLOOMBERG
The post Thailand signals baht intervention room after US puts it on currency watchlist appeared first on The Malaysian Reserve.
