File photo for reference only

 

The Bank of Thailand is set to counteract the rapid appreciation of the baht, which has surged nearly 7% this year, placing it at a competitive level against the US dollar. Central bank measures, including tax reforms, enhanced gold transaction oversight, and an expected interest rate cut, aim to relieve pressure on the baht. Such actions are crucial as the baht strengthens to levels exceeding 32 per dollar, affecting exports and tourism.

 

In a strategic shift, the Finance Ministry plans to increase the foreign income limit, exempt from mandatory repatriation, to US$10 million (฿357 million) per transaction from the current US$1 million. This change, happening this month, provides businesses with more leeway in handling foreign revenues while controlling forex inflows into the country. Additionally, stricter supervision on gold-related transactions will require financial institutions to ramp up their due diligence.

 

Gold traders are expected to adhere to rigorous reporting of transaction details, helping authorities regulate the forex market effectively. This comes as the baht's strengthening aligns with a 4% rise in global gold prices, suggesting that gold flows have significantly influenced recent currency movements. Baht performance has also been buoyed by a softer US dollar, export forex sales, and bond inflows.

 

Samuel Hertz from EBC Financial Group points out that the Bank of Thailand’s concern is the impact of the baht's rapid rise on export and tourism competitiveness—key economic pillars. Raising the repatriation threshold is seen as a tactical step to moderate the currency volume entering Thailand, providing companies with enhanced liquidity management capabilities.

 

Looking forward, monetary policy is under scrutiny, with Central Bank Governor Vitai Ratanakorn hinting at potential rate cuts. Analysts foresee a further reduction from 1.5% at an upcoming meeting on 17 December, building on four previous cuts this year. The move may have limited effects on deep-rooted economic issues, but it aims to stabilise currency fluctuations, according to the Bangkok Post.

 

As domestic and international policy developments unfold, traders and businesses remain alert. Hertz highlights that Thailand's central bank will continue monitoring baht activities closely, ready to intervene if business impact threatens. The overarching strategy encompasses exchange rate steering, transaction oversight, and foreign income rules to cut volatility without altering economic fundamentals.

 

Key Takeaways

 

• The baht has surged nearly 7% this year, prompting strategic interventions.
• New measures include foreign income threshold hikes and stricter gold transaction oversight.
• An anticipated rate cut aims to stabilise currency impacts on exports and tourism.

Related Stories:

Thai PM Anutin Urges Action on Strong Baht Currency

BoT Plans Baht-Easing Measures as Rate Cuts Remain Possible

 

  Adapted by ASEAN Now from [Bangkok Post 2025-12-06

 

 

 

Thailand Fights to Cool Rapid Rise of the Baht
 

There a first. Cool it by 0.1% perhaps? It’s about 30% overpriced. 

22 minutes ago, daveAustin said:

Thailand Fights to Cool Rapid Rise of the Baht
 

There a first. Cool it by 0.1% perhaps? It’s about 30% overpriced. 

The problem seems so obvious, it has been expressed by a number knowledgeable people. The greed and corruption around the sale and movement of gold through Thailand. Thai leaders dance around it. The economy is so bad there is no other reason to explain it, or so it seems to me with my very limited understanding of these things.

Tourism dropped 7 percent this year as well.

 

Constantly different news about how they calculate the exchange rate.. First it was connected to the USD , now it is the goldprice.. I suppose they use what they think is most favorable for them, and how they can fill their pockets best..All bad news about tourism, economy, disasters, politcal instability and so on have no influence on the THB.. no it only strengthen day by day.. too expensive and it is damaging the economy and tourism more and more. But many don't care as they will get richer once the THB collapses

They keep  talking about it but nothing is done about it too many elites making money overseas exports and tourism is going to suffer badly but they will say tourism is up what a joke wakeup thailand

Maybe stop the rife money laundering?

Talk and No Action as usual.

Sorry I do not understand - over (say) the past month it has been the 42 range, how is that a 'rapid rise' ?

16 minutes ago, JoePai said:

Sorry I do not understand - over (say) the past month it has been the 42 range, how is that a 'rapid rise' ?

Because they are talking about the USD, and this year, not over one month.

Of course, most of us want the Baht to fall.  But then I started thinking…what if the Baht rose to parity with the U.S. Dollar?  I could sell my Baht and return to America as a millionaire…

 

Surely the Baht is only half the problem?

The other currency involved also has it's ups

and downs ......

Thailand Fights to Cool Rapid Rise of the Baht

 

Whatever they are doing , it is not working.

 

7 hours ago, webfact said:

as the baht strengthens to levels exceeding 32 per dollar

exceeding implies that when the baht strengthens is will be more than 32 per dollar.

As usual,  Thailand fighting the baht with one hand tied behind its back.

4 hours ago, Isaan sailor said:

Of course, most of us want the Baht to fall.  But then I started thinking…what if the Baht rose to parity with the U.S. Dollar?  I could sell my Baht and return to America as a millionaire…

 

would you really?  i was just there and T has turned it into a police state.

9 hours ago, webfact said:

............ US$10 million (฿357 million).........

One US dollar gets 35.7 Thai baht?

9 hours ago, webfact said:

Such actions are crucial as the baht strengthens to levels exceeding 32 per dollar, affecting exports and tourism.

The bungee baht....

5 hours ago, ozz1 said:

They keep  talking about it but nothing is done about it too many elites making money overseas exports and tourism is going to suffer badly but they will say tourism is up what a joke wakeup thailand

just talking to shop and small business owners, massage shops, food outlets, they are saying very quiet no customers, that's Huahin at the moment, high season is not obvious, same last year hardly noticed high season.

The Thai Bhat is way to high, and must drive tourists away, plus it hurts expats pensions.

Yes they have been talking about doing something about it but nothing done and it is hurting everyone. 

1 hour ago, malibukid said:

would you really?  i was just there and T has turned it into a police state.

REALLY! Tough times require tough measures. Never in the history of our country has crime and criminals been so out of control. There is no alternative except to bring out the National Guard and ICE and Border Patrol to clean up the crime ridden Democrat run cities. For some, it's like living in a war zone with more dead per week than in the war in Afghanistan, and the Democrats love it that way. Mayors are calling for defunding the police while government prosecutors are releasing criminals with a rap sheet a mile long back into the streets to commit more heinous crimes. And what, Sir, would be your solution to "Make America Safe Again"

4 hours ago, FlorC said:

Thailand Fights to Cool Rapid Rise of the Baht

 

Whatever they are doing , it is not working.

 

exceeding implies that when the baht strengthens is will be more than 32 per dollar.

Strengthening means that the baht will buy more American dollars

10 minutes ago, fittobethaied said:

REALLY! Tough times require tough measures. Never in the history of our country has crime and criminals been so out of control. There is no alternative except to bring out the National Guard and ICE and Border Patrol to clean up the crime ridden Democrat run cities. For some, it's like living in a war zone with more dead per week than in the war in Afghanistan, and the Democrats love it that way. Mayors are calling for defunding the police while government prosecutors are releasing criminals with a rap sheet a mile long back into the streets to commit more heinous crimes. And what, Sir, would be your solution to "Make America Safe Again"

You hit the nail on the head with your comment. You took the words right out of my mouth.

The Thai Baht is high because the wealthy elite here want the Baht high - then their imports and their loan payments and their other financial 'investments' cost a lot less than they otherwise would. The BOT has been doing as their masters have bid, including not lowering interest rates anywhere near enough, but also in their trading activities, and their other financial decisions.  Unlike in the West they do not report any of their financial transactions (buying the Baht etc.).  The fact that they have encouraged the gold to be sold in Baht by hitting sales in USD with more taxes, shows the sort of things that have been going on. Singapore as an example, forces gold traders to use the USDS as much as possible - they do not want the Sing. Dollar (SGD) increasing as it will negatively affect their economy. 

 

Gold sales are not affected as much by the high Baht, because of the increasing demand since the Ukraine war and Covid.  But Thailand in terms of generating production and jobs, is mainly a trade export and tourism based economy - and the Baht has been too high for almost 10 years (since the Junta). The high Baht is the single biggest reason why the Thai economy is crashing - and it is crashing - they can't sell real estate or cars - very few people are buying - everything is slowing down.  It could end in a severe catastrophic crash like in the 90s when they were warned not to play speculation games with their currency for short term profits - but they were too greedy to listen - and they are still not listening. 

12 hours ago, webfact said:

The baht has surged nearly 7% this year, prompting strategic interventions.

 

 

When I moved from Thailand to Cambodia about 6 years ago, the exchange rate was 37 baht for 1$ Today it is 31.9! 

Keep the baht high and buy dollars. float the baht on the market and watch it fall and buy back baht. Then put the baht back where it was. Rinse and repeat.

The rich and powerful in Thailand like a strong baht. It supports their investments in overseas property etc 

16 hours ago, webfact said:

Gold traders are expected to adhere to

I stopped reading with that^^^^^^

blah blah blah

 

They are not very good at their job now, are they?

thailand should take the opportunity to stock up gold reserves

8 hours ago, fittobethaied said:

REALLY! Tough times require tough measures. Never in the history of our country has crime and criminals been so out of control. There is no alternative except to bring out the National Guard and ICE and Border Patrol to clean up the crime ridden Democrat run cities. For some, it's like living in a war zone with more dead per week than in the war in Afghanistan, and the Democrats love it that way. Mayors are calling for defunding the police while government prosecutors are releasing criminals with a rap sheet a mile long back into the streets to commit more heinous crimes. And what, Sir, would be your solution to "Make America Safe Again"

MPLS, MN comes to mind.

While the present economic situation might not compare to the crash of the late 90s or low baht exchange rates of early 2000s (USD 40+; GBP 77!), the current sutuation is indeed pretty dire for Thailand on all economic fronts. So it's bewildering to wonder why the THB isn't around 36-38 to the dollar (at least).