Baht weakens further after deputy PM and four major officials resigned

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The Thai baht continues to devalue yesterday after Deputy Prime Minister Somkid Jatusripitak and four other major officials have resigned, loosing foreign investors’ confidence in the government’s economic strategies.

Currently, Thai baht is Asia’s weakest currency against the US dollar on a year-to-date basis, down by 5.5%, Reuters reported. At one point on Thursday, the baht falls to 31.76 against the US dollar.

According to statistics, the baht emerged as Asia’s top-performing currency in 2019, reaching the 30-baht-per-dollar mark before the New Year, driven by the country’s huge current account surplus and large foreign reserves.

The reshuffle of the government’s economic team has caused doubt among foreign investors, who are concerned about continuity in the government’s policies — especially with regard to the Eastern Economic Corridor, a special economic development zone of three provinces in eastern Thailand, says Tim Leelahaphan, an economist at Standard Chartered Bank Thai.

“The names of potential candidates of the new economic team do not matter much, as the government needs to set up a new cabinet rapidly and continue existing economic policies,” Tim said. “The government has contained the outbreak and implemented financial relief measures quite well for the past several months. Such direction needs to continue to maintain a positive economic recovery momentum.”

Original writer: Somruedi Banchongduang
Source: Bangkok Post