As the Thai government cut its forecast for economic growth and the Federal Reserve said it’s on track to raising interest rates this year, Thailand’s baht recorded its biggest weekly decline since May reaching a six-year low of 34.24. The currency rebounded on Friday, rising by 0.2%.

Some of Thailand’s deputy ministers view the weaker baht positively. A lower-priced baht will help the country’s exports and offer more of a boost to a struggling economy than a rate cut, it is hoped.

Southeast Asia’s second-largest economy feels the burden of record household debt which has blunted the impact of low interest rates. Thus, with exports worth more than half the country’s GDP, the government sees the stimulus from a weaker baht as a better bet for recovery.

Pridiyathorn Devakula, the man in charge of the economy, told Reuters, ”When I want to correct the economy, I’d rather play with the exchange rate.” Pridiyathorn, a former finance minister and central bank governor, is actually hoping for an even weaker Thai Baht, below the six-year low against the dollar.

Pridiyathorn stated, “I’d like to see the baht depreciating a little more.” He added, “It’s almost at the right level now” but declined to give a target level for the baht.

Mr. Pridiyathorn advises that one would have to be patient to analyze the impact of a weaker baht. It would take three or four months for exports to feel the impact of the weaker baht — the impact should be felt in time for orders during the fourth quarter, he said. Exports would still likely contract in a range between 2% and 3% meaning that 2015 would be the third consecutive year that exports have fallen, he stated.

However, a rebound in tourism and heavier investment should compensate for falling export levels, which will help the economy to still reach growth levels of 3% this year, he said. Mr. Pridiyathorn remains positive for the future and believes, for 2016,  growth should settle around 4% and then reach for the 4% to 5% levels in 2017.

Yet, one has to stay cautions, as the decline in shipments is a longer-term trend that Thailand should have trouble to reverse. Many of Thailand’s exports have become obsolete — in the lower-value manufacturing industries, Thailand cannot compete with the cheaper labour costs of its neighbors. Simply betting on a weak Thai Baht is unlikely to reverse that trend.

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