Thai Govt. To Control Excessive Currency Fluctuation, PM Says
8/27/2010 8:48 AM ET
(RTTNews) - The Thai government will prevent excessive fluctuation in the currency, Prime Minister Abhisit Vejjajiva reportedly said on Friday.
Abhisit told reporters in Bangkok that such measures will not go against the mechanism of the market. We have learnt an expensive lesson from doing so, he added. The prime minister said current inflation rate is manageable. Annual inflation rose to 3.4% in July from 3.3% in June.
The Thai baht has strengthened recently raising exporters' concerns. Exports had advanced 20.6% year-on-year in July, which was the ninth straight month of growth. However, this was notably slower than the 46.3% growth seen in the previous month.
Last week, Commerce Minister Porntiva Nakasai urged the central bank to take necessary actions to stabilize the currency. Today, Abhisit said currency appreciation has been a problem in Asian economies.
He said the Bank of Thailand will be careful in adjusting interest rate. To curb rising inflation, the central bank had raised its key rate for the second straight month in August. A rise in interest rate would strengthen currency, ultimately impacting exports.
The Thai prime minister said the economy would grow at a slower pace in the second half of 2010. Still, the growth rate for this year would exceed 7%. GDP growth is then estimated to ease to 4%-5% next year.
8/27/2010 8:48 AM ET
(RTTNews) - The Thai government will prevent excessive fluctuation in the currency, Prime Minister Abhisit Vejjajiva reportedly said on Friday.
Abhisit told reporters in Bangkok that such measures will not go against the mechanism of the market. We have learnt an expensive lesson from doing so, he added. The prime minister said current inflation rate is manageable. Annual inflation rose to 3.4% in July from 3.3% in June.
The Thai baht has strengthened recently raising exporters' concerns. Exports had advanced 20.6% year-on-year in July, which was the ninth straight month of growth. However, this was notably slower than the 46.3% growth seen in the previous month.
Last week, Commerce Minister Porntiva Nakasai urged the central bank to take necessary actions to stabilize the currency. Today, Abhisit said currency appreciation has been a problem in Asian economies.
He said the Bank of Thailand will be careful in adjusting interest rate. To curb rising inflation, the central bank had raised its key rate for the second straight month in August. A rise in interest rate would strengthen currency, ultimately impacting exports.
The Thai prime minister said the economy would grow at a slower pace in the second half of 2010. Still, the growth rate for this year would exceed 7%. GDP growth is then estimated to ease to 4%-5% next year.