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Thai Baht to remain volatile next year

Emerging markets, particularly in Asia and Thailand, would become interesting places, because they would lead the economic recovery, while the US would remain an interesting market because of attractive asset prices.

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Bank of Thailand (BoT) Governor Prasarn Trairatvorakul  conceded the baht would remain volatile next year as a result of continued capital inflows.

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Speaking during a meeting with representatives of the Thai Chamber of Commerce on the “Adjustment of Thai Economy under the Monetary Policy Framework,” he said that US$30 billion of foreign capital had so far flowed into Thailand.

Of this, $12 billion is revenue earned from Thailand’s exports of products and services, $1.5 billion is capital flowing into the stock market, $4.5 billion into the bond market and the remainder are foreign direct investments.

A large amount of capital flowed into Thailand in third quarter of this year, but there was a capital outflow in November.

He said the central bank continued to intervene in the baht’s movement to ease the currency fluctuation, but it would not peg the baht at a particular level because it runs a risk of being attacked.

via Baht to remain volatile next year, says BOT chief.

The Bank of Thailand (BoT) raised the policy interest rate to 2%

The Bank of Thailand (BoT) on Wednesday raised the policy interest rate by 0.25 per cent from 1.75 to 2.00 per cent, effective immediately, BoT Assistant Governor Paiboon Kittisrikangwan said.

The decision was made by the Monetary Policy Committee.

It is less important to maintain the current extra-accommodative monetary policy stance when Thailand’s economy is expected to grow at 7-8 per cent this year and 3-5 percent next year, Mr Paiboon said.

As a result, the interest rate should be readjusted to a normal rate after the BoT kept it low for the past two years.

The Monetary Policy Committee raised the interest rate by 0.25 per cent at its last two meetings, in July and August, consecutively.

New Investors focus on emerging markets

Emerging markets, particularly in Asia, would become interesting places, because they would lead the economic recovery, while the US would remain an interesting market because of attractive asset prices.

The appreciation of the Thai baht is not caused by capital inflows but the Bank of Thailand (BoT) has been asked to keep a close watch on the currency’s appreciation and prepare measures to cope with capital inflows for currency speculation as the monetary unit hits a two-year high, Finance Minister Korn Chatikavanij said.

The finance minister told reporters that the meeting resolved that the weak US economy and its debt burden has pushed the baht to become stronger in tandem with other currencies.

Economics

The Future of Asia: greener but with a public and private debt hangover

The COVID-19 pandemic has been a perfect storm, destroying jobs, worsening poverty and inequality, and creating a public and private debt problem—especially for countries and firms already in fragile financial health beforehand

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The Sydney Opera resumed live performances and the city of Melbourne recently hosted the Australian Open tennis tournament with fans (mostly) in attendance.

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Economics

50:50 campaign may not get immediate extension

National News Bureau of Thailand

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BANGKOK (NNT) – The government’s 50:50 co-pay campaign expiring on 31st March may not be getting an immediate campaign extension. The Minister of Finance says campaign evaluation is needed to improve future campaigns.

The Minister of Finance Arkhom Termpittayapaisith today announced the government may not be able to reach a conclusion on the extension of the 50:50 co-pay campaign in time for the current 31st March campaign end date, as evaluations are needed to better improve the campaign.

Originally introduced last year, the 50:50 campaign is a financial aid campaign for people impacted by the COVID-19 pandemic, in which the government subsidizes up to half the price of purchases at participating stores, with a daily cap on the subsidy amount of 150 baht, and a 3,500 baht per person subsidy limit over the entire campaign.

The campaign has already been extended once, with the current end date set for 31st March.

The Finance Minister said that payout campaigns for the general public are still valid in this period, allowing time for the 50:50 campaign to be assessed, and to address reports of fraud at some participating stores.

The Fiscal Police Office Director General and the Ministry of Finance Spokesperson Kulaya Tantitemit, said today that a bigger quota could be offered in Phase 3 of the 50:50 campaign beyond the 15 million people enrolled in the first two phases, while existing participants will need to confirm their identity if they want to participate in Phase 3, without the need to fill out the registration form.

Mrs Kulaya said the campaign will still be funded by emergency loan credit allocated for pandemic compensation, which still has about 200 billion baht available as of today.

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Economics

Customs Department Considers Measures to Help SMEs

National News Bureau of Thailand

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BANGKOK (NNT) – The Customs Department is seeking ways to reduce the impact of the exemption on import tax and value-added tax (VAT) for imported goods worth up to 1,500 baht, as such measures are hurting small and medium-sized enterprises (SMEs).

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