BOT denies it spends $3-4bn on baht intervention

BANGKOK: -- Bank of Thailand’s Governor M.R. Pridiyathorn Devakula yesterday conceded the central bank had intervened in the baht movement, but denied it had spent up to US$3-4 billion on the intervention.

The BOT’s clarification was made in response to Phatra Securities Plc’s analysis report that the central bank had already spent around $3-4 billion of the international reserve purchasing the baht and dumping the dollar in the forward market, and would have to intervene in a few months ahead.

M.R. Pridiyathorn admitted the central bank had intervened the currency movement, but had not spent the reserve in such a huge amount as reported.

At present, he said, the baht had begun to stabilize to such an extent that the central needed not intervene.

The BOT chief also brushed aside the report on the sharp decline in the international reserve, saying it had dropped to only a certain extent partly because of the depreciation of one of the major currencies in the basket.

“It is unjustifiable for the analysis report to say the central bank will have to intervene in the baht movement in a few months ahead. Whether the bank will intervene or not depends on the suitability. We cannot tell at which level the baht should stay in a particular time.

“The baht is considered staying at an appropriate level when there is neither speculation nor currency attack. Its value must neither hinder trade nor fuel inflation rates,” he said.

A source at the BOT disclosed as of June 10, the country’s international reserve stood at $48.3 billion, down from $49.2 billion at the end of April. Forward contracts were worth $4.7 billion, down from $6.9 billion.

--TNA 2005-06-23

Hi

What currencies are in the baht basket ? and in what quantity or pencentage ?

Or where can i find this out ? Is it possible to find this out ?

Just did a google and came up with this - very interesting but doenst seem to have basket details in it.....

http://www.emeap.org/review/0001/index_e.htm

"At present, he said, the baht had begun to stabilize to such an extent that the central needed not intervene."

He hasnt looked at a chart showing the baht movement in the last few weeks and days or....

He has a different defintion of "stabilize" than the rest of us.

I will be renewing my visa for Thailand next year.