Business operators have renewed calls for the Bank of Thailand to address the baht’s strength, saying an exchange rate of 34-35 baht per US dollar would be more favourable for exports.
Speaking after a meeting between the central bank and the Federation of Thai Industries (FTI) held on Tuesday, Kriengkrai Thiennukul, chairman of the trade group, said continued baht appreciation against the dollar has weakened Thailand’s competitiveness in both exports and tourism — the country’s two key economic drivers — compared with regional peers.
Exports and tourism typically contribute around 60% and 10% of Thailand’s total revenue, respectively.
Against this backdrop, the industrial sector also presented several proposals on baht management to central bank governor Vitai Ratanakorn.
This year the baht has appreciated by as much as 8% against the US dollar, before easing to around 5% at present. In contrast, the Vietnamese dong and the Indonesian rupiah have depreciated by around 3% and 2%, respectively.
Thai exports to the US account for about 18% of total export value, compared with 32% for Vietnam, according to FTI data.
“Exporters would like the baht to weaken by about 2 baht per US dollar, moving within a range of 34-35 baht per dollar, to enhance Thailand’s competitiveness,” said Mr Kriengkrai.
The FTI acknowledges in addition to a weaker dollar, other factors are contributing to the baht’s appreciation, including rising gold prices. Money laundering through gold and cryptocurrency trading — possibly linked to cross-border scams — may also be influencing the baht’s strength against the dollar, he said.
Given these concerns, the private sector urged relevant regulatory agencies to investigate such transactions, trace money flows and identify the true factors behind the baht’s appreciation.
Although Thailand’s correlation between its currency and gold prices is higher than in many other countries, gold exports have also surged significantly, particularly to Cambodia. Cambodia is now Thailand’s second-largest gold export market after Switzerland.
During the first seven months of this year, Thailand’s gold shipments to Cambodia tallied 71.3 billion baht, up from 59.9 billion year-on-year and compared with 106 billion baht for all of 2024.
Mr Kriengkrai said the meeting also covered the impact of US tariffs on the Thai economy. The FTI estimates US tariffs could affect Thai GDP growth by between 0.01 and 0.77 percentage points, depending on how effectively the government responds to the challenge.
In separate news, Mr Vitai confirmed after the meeting the central bank stands ready to work with relevant agencies to ensure effective coordination between monetary and fiscal policy to maintain economic stability.
Amid both external and domestic headwinds, the regulator downgraded its GDP growth forecasts for 2025 and 2026 to 2.2% and 1.6%, respectively, from previous estimates of 2.3% and 1.7%.