Finance Ministry aims to fix currency issue, taking care of overall economy

 

   

BANGKOK (NNT) - The Ministry of Finance is set to issue SME business measures as a 2020 New Year gift, which is expected to be submitted for Cabinet’s approval next month. The Ministry is now working to solve the overly strong Thai baht issue, and set up committees to look after overall economic development.

 

The Minister of Finance Uttama Savanayana, has revealed the latest effort to moderate the strength of the Thai baht, advising that at the moment the Ministry of Finance is working with the Bank of Thailand on the issue, in order to promote better integrated efforts by different agencies, including the National Economic and Social Development Council (NESDB).

 

He said only the Bank of Thailand has the authority to regulate the currency exchange rate, and the Ministry of Finance will only look at information exchanges to help stabilize the currency.

 

The Ministry of Finance is now in the process of introducing business promotion measures as a New Year gift for SMEs, in compliance with a policy delivered by Deputy Prime Minister Somkid Jatusripitak. The Finance Ministry said related agencies have already drafted the measures, which should be proposed for Cabinet’s approval in January. Any measures not requiring the Cabinet’s approval will be proceeded with immediately by the Ministry of Finance.

 

To oversee overall economic development, the Ministry of Finance will be setting up working committees responsible for economic stability and for economy driving policies. More details of the new committees and their roles will be released after the New Year holidays.

 

The Ministry is expecting better economic growth next year compared to this year due to internal factors such as higher purchasing power and government investments, additional investments by the private sector; and external factors such as the global economic trend signalling a mitigation of conflicts between economic powerhouses.

 

-- © Copyright NNT 2019-12-31

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Setting up committees usually means it is going to take a long time for anything to be done, if anything at all.

This story is total BS

Much of the blame rests on the US. Driving down interest rates and slowing macro economic data. If the US President was not openly calling for negative rates AND the FED not embarking on a policy of appeasment during what they claim is the best economy and job market ever we would have a stronger dollar. 

3 hours ago, webfact said:

He said only the Bank of Thailand has the authority to regulate the currency exchange rate, and the Ministry of Finance will only look at information exchanges to help stabilize the currency.

Quite right! But they too follow directives given by the government, the government is made up of characters who have only one goal, to enrich themselves as much as possible and as soon as possible!
It would be interesting to know how many of them borrowed money to speculate on the Baht!

"and external factors such as the global economic trend signalling a mitigation of conflicts between economic powerhouses".

 

Everyone's waiting for the trade war to end in the hope that will solve the problem but it's unlikely that it will, all that will happen is exports will pick up but the Baht problem will still be there.

Talk Talk thats all we get NO ACTION..????

Alone all this talk of reigning in the Baht should make foreign investors cautious, talk alone can accomplish much.

5 hours ago, webfact said:

He said only the Bank of Thailand has the authority to regulate the currency exchange rate, and the Ministry of Finance will only look at information exchanges to help stabilize the currency.

So basically no change then, as in 2019 the BOT achieved nothing for the strength of the baht except keep it high!

A off topic nonsensical post has been removed.

19 minutes ago, hotchilli said:

So basically no change then, as in 2019 the BOT achieved nothing for the strength of the baht except keep it high!

But the US helped in that process a whole bunch!

To summarise they do not have a clue what to do and relying on BOT to come up with something and BOT is pretty much out of ideas as all its past attempts have failed 

3 minutes ago, saengd said:

But the US helped in that process a whole bunch!

What does US have to do with BOT?

Just now, BestB said:

What does US have to do with BOT?

Duh!

 

BOT operates a managed floating peg to USD,

The US Dollar Index has been well below par for the past two years, often as low as 90,

Ergo, USD is far weaker than normal or might be expected or desired, put another way, THB is stronger than it ought to be as a result.

AND

The US initiated a trade war with one of Thailand's largest trading partners meaning that Thai growth is subdued, the lack of economic growth supresses inflation and the ability to weaken the currency.

 

9 hours ago, webfact said:

He said only the Bank of Thailand has the authority to regulate the currency exchange rate,

contradictory, because the governor of BoT said he had no power/tools to control the exchange rate only the government could.... they all waited the last day of the year to play April fools

7 minutes ago, Mavideol said:

contradictory, because the governor of BoT said he had no power/tools to control the exchange rate only the government could.... they all waited the last day of the year to play April fools

Nonsense, BOT owns the Foreign Currency Reserves, not the government.

5 minutes ago, Mavideol said:

contradictory, because the governor of BoT said he had no power/tools to control the exchange rate only the government could.... they all waited the last day of the year to play April fools

There is no need to listen to them. If they would/could tell you what will happen then currency trading would be very easy. 

Just now, saengd said:

Nonsense, BOT owns the Foreign Currency Reserves, not the government.

I didn't say they did....I said, a couple months ago when there was exchange rate issues with exports and lack of tourists (please feel free to check past posts on TV it's there),  the governor of BoT made the comment that was not under his control

4 minutes ago, Mavideol said:

I didn't say they did....I said, a couple months ago when there was exchange rate issues with exports and lack of tourists (please feel free to check past posts on TV it's there),  the governor of BoT made the comment that was not under his control

He's correct. tourism and exports are not in his remit, he simply operationalizes government policy which is supposed to aid those things. BUT he is in a position to control the value of THB, that certainly is within his remit and management of the FCR is one way to do that.

5 hours ago, Jessi said:

Talk Talk thats all we get NO ACTION..????

 

What action can they do?

 

They know that cutting interests rates will have a minimal effect. They have no power over Forex traders and international investors in their decision making.

 

The strong Thai balance of payments and Forex reserves is seen as a safe haven at the moment. USD crashing, GBP up and down like a whore's draws; Euro looking weak and dodgy. Trade deals on/off/on/off etc etc.

 

What action would you advise then?

48 minutes ago, saengd said:

Nonsense, BOT owns the Foreign Currency Reserves, not the government.

 

And do you think the BOT operate totally freely, with no "advice" from the government?

23 minutes ago, Baerboxer said:

 

And do you think the BOT operate totally freely, with no "advice" from the government?

That's pretty much what an independent central bank does, as long as they are acting out government policy.

 

Without pointing fingers, just look at Baht vs USD chart pattern for today, this week, or this month.

Now look at the Chinese Yuan vs USD or Baht chart patterns for today, this week, or this month.  You will see the exact opposite chart.  When USD goes down in Thailand, the Yuan goes up.

Pretty obvious what’s going on...

Edited December 31, 20196 yr by Isaan sailor

Yada,Yada,Yada.

39 minutes ago, Isaan sailor said:

Without pointing fingers, just look at Baht vs USD chart pattern for today, this week, or this month.

Now look at the Chinese Yuan vs USD or Baht chart patterns for today, this week, or this month.  You will see the exact opposite chart.  When USD goes down in Thailand, the Yuan goes up.

Pretty obvious what’s going on...

It's pretty obvious that you are failing to understand the message on this, RMB is hard pegged to USD, THB is not, that's why THB is stronger.

7 hours ago, saengd said:

Duh!

 

BOT operates a managed floating peg to USD,

The US Dollar Index has been well below par for the past two years, often as low as 90,

Ergo, USD is far weaker than normal or might be expected or desired, put another way, THB is stronger than it ought to be as a result.

AND

The US initiated a trade war with one of Thailand's largest trading partners meaning that Thai growth is subdued, the lack of economic growth supresses inflation and the ability to weaken the currency.

 

Oh I see. Good to see another expert economist in the mist. So BOT and baht is influenced by US????

1 minute ago, BestB said:

Oh I see. Good to see another expert economist in the mist. So BOT and baht is influenced by US????

come on man, you didn't know that in Thailand it's always somebody else's fault, Thailand government never did nor they will do anything wrong, NEVER

 

Just now, Mavideol said:

come on man, you didn't know that in Thailand it's always somebody else's fault, Thailand government never did nor they will do anything wrong, NEVER

 

This I knew, just did not know junior expert economist parroted the sane nonsense to appear smart ????