Thailand: Strong baht puts pressure on export, tourism

A rapid appreciation of the Thai baht (THB) is hitting exports and tourism, says the Bank of Thailand.

The currency reached its highest level in 31 months on Monday, at 32.235 THB against the greenback, as reported by the Bangkok Post.

The rapid rise comes ahead of a meeting between the central bank and the Finance Ministry this week, where the currency's performance and the country's inflation target are expected to be discussed.

The meeting follows months of government pressure on the central bank to cut interest rates and align with fiscal policy aimed at stimulating the economy.

The bank has so far resisted calls for a cut, holding rates unchanged at 2.5% for a fifth straight meeting last month, saying a cut was not necessary.

It had managed the baht's volatility, BoT assistant governor Chayawadee Chai-anant told reporters. The stronger baht was impacting exporters when converting profits back to baht, she said, adding that it would also hit tourism spending.

The bank has forecast economic growth of 2.6% for 2024, after last year's 1.9% expansion, which lagged regional peers.