The Bank of Thailand (BoT) has expressed confidence in the stability of the baht despite its recent depreciation against the US dollar amid heightened external uncertainties linked to the conflict in the Middle East. The central bank said there is no need for a special meeting of its Monetary Policy Committee (MPC), citing the currency’s orderly movement and Thailand’s strong external fundamentals.
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According to Chayawadee Chai-anant, assistant governor for corporate relations and spokesperson for the BoT, the baht has weakened by 5.4% against the US dollar since the onset of the Middle East conflict. However, foreign investors have recorded net sales of Thai assets totalling only US$1.3 billion. She noted that foreign funds have recently begun returning to Thailand’s long-term bond and equities markets, reflecting improved investor sentiment.
The ongoing conflict has raised concerns about energy security around the world, including in Southeast Asia. Governments across the region have introduced various measures to address the oil shock and support economic activity, although some of these actions have affected asset prices, foreign exchange markets and interest rates.
Indonesia has taken a different approach. On Tuesday, Bank Indonesia held a special meeting and raised its policy rate to ease pressure from the rapid depreciation of the rupiah against the dollar. Since the war against Iran began, the rupiah has weakened by more than 8%, one of its sharpest declines on record.
The Indonesian currency’s decline followed sustained foreign investor selling of equities and bonds amounting to roughly US$3.9 billion. Investors have expressed concerns about domestic stability, including fiscal policy direction and the possibility that Indonesia’s stock market could be downgraded from emerging market to frontier market status.
Ms Chayawadee said that while the baht has also depreciated against the dollar, its movement has remained orderly and stable. As a result, the BoT does not see a need to convene a special MPC meeting to consider changes to the policy rate.
Pipat Luengnaruemitchai, chief economist at Kiatnakin Phatra Financial Group, expects the MPC to maintain its policy rate at 1% throughout this year. He forecasts that rates could be raised around the middle of next year, depending on economic conditions and inflation.
Don Nakornthab, the BoT’s assistant governor for monetary policy, wrote on his personal Facebook page that Thailand and Indonesia face fundamentally different economic circumstances. He argued that despite Indonesia’s stronger fiscal indicators, the country remains vulnerable to concerns over state-owned enterprise debt, governance issues surrounding the Danantara sovereign wealth fund, a current account deficit and a smaller foreign reserve buffer than Thailand.
The Bangkokpost reported that Mr Don said the likelihood of Thailand facing a currency crisis in the near term remains relatively low. He added that Thailand’s primary challenge is not currency stability but the need for structural reforms to restore competitiveness and place the economy on a stronger growth path.
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Adapted by ASEAN Now Bangkokpost 13 June 2026
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