Thailand central bank vows to step in if baht moves are unhinged
[BANGKOK] Thailand's central bank is ready to tackle excessive baht volatility by managing any moves 'unhinged' from its fundamentals, a deputy governor said, amid calls from local businesses to temper the currency's rally to help exports and tourism.
'We do look at the baht closely and try not to let it be too volatile,' Piti Disyatat said in an interview late on Thursday (Jun 26). 'If it's driven by non-fundamental reasons, portfolio perceptions, sentiment that's unhinged with macro fundamentals then we will reduce the volatility.'
The Thai baht has surged about 5 per cent this year, prompting some ministers and business groups to call for the central bank to weaken the currency to boost exports and tourism – the nation's biggest drivers of growth.
Piti's comments also come at a time when the nation is in trade talks with the US to lower a 36 per cent tariff rate on its goods. President Donald Trump has long accused Asian countries for maintaining undervalued exchange rates that helped them amass trade surpluses with the US.
The Bank of Thailand doesn't target any particular level or direction for the baht and its gain this year is in line with regional peers, Pita said. The currency is little changed on a trade-weighted exchange-rate basis and hasn't hurt the country's export competitiveness, he said.
Thailand's exchange rate policy complies with the International Monetary Fund code when it comes to managing volatility so it shouldn't become an issue, Piti said, when asked if tariff talks with the Trump administration included exchange rate.
While foreign-exchange intervention was one instrument at the central bank's disposal to maintain stability, BOT mostly allows the flexible exchange regime to absorb shocks, Piti said, adding 'we manage it only when we really have to.'
The baht's move in tandem with gold prices is not deemed as a fundamental reason, though it amplifies the currency's movements, he said.
A jump in Thailand's foreign reserves to a record US$259.9 billion this month reflects valuation adjustments in its asset holdings, rather than the central bank mopping up additional dollars, Piti said. BLOOMBERG
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Times
3 hours ago
- Business Times
Roger Federer's long-term deals make him a tennis billionaire
[LONDON] Tennis superstar Roger Federer is now one of the few athletes who can now count themselves a billionaire. Federer, who won 20 Grand Slams between 2003 and 2018, amassed US$130.6 million in prize money during a 24-year playing career that ended in 2022. But the bulk of the Swiss star's wealth has come via a series of bumper sponsorship deals, alongside an astute investment in a local sneaker brand. His net worth is about US$1.3 billion, according to the Bloomberg Billionaires Index, putting him in elite company. Michael Jordan's hit an estimated US$3.5 billion after the sale of his stake in the Charlotte Hornets in 2023, while last year Bloomberg calculated Tiger Woods' wealth at about US$1.36 billion. Federer is worth considerably more than US$1 billion, according to people close to him who spoke on condition of anonymity. Bloomberg's valuation takes into account Federer's career earnings, investments and endorsement deals, adjusted for prevailing Swiss tax rates and market performance. Many of his deals have lasted decades, from sponsorships with Credit Suisse bank (now UBS Group), watchmaker Rolex, and Swiss chocolatier Chocoladefabriken Lindt & Sprungli. Federer has also built a close advice network around him, including through Team8, the management company he co-founded with longtime agent Tony Godsick in 2013, and also Swiss firm Format A, which helps manage various investments and his charitable foundation. 'Federer is totally scandal free. He never says the wrong thing,' sports analyst Bob Dorfman said. 'He hasn't been a John McEnroe, feisty personality type. But in terms of marketability, he's been one of tennis's best.' A NEWSLETTER FOR YOU Friday, 2 pm Lifestyle Our picks of the latest dining, travel and leisure options to treat yourself. Sign Up Sign Up Federer's biggest deals came near the end of his career. By 2018, a rolling contract with Nike – first signed in 1996 – had come up for renewal. Tennis was not a core market for Nike, allowing Godsick to test the water with other potential partners. Uniqlo, a popular brand owned by Japan's Fast Retailing, offered Federer US$300 million over 10 years to be one of its flagship sports icons. Federer was 37 and close to retirement and the deal had no strings attached, even if he stopped playing. It was a no-brainer. Still, it was not Federer's most successful deal. That was an investment that came via an accidental introduction by his wife, who bought a pair of sneakers from up-and coming Swiss brand On. There are plenty of bankers and lawyers in Switzerland, but not many sports brands. Founded in 2010, On had become known as a high-end jogging shoe. Its distinctive sole, with more empty space than rubber, was based off a prototype made by co-founder Olivier Bernhard – a former pro-Ironman – taping offcuts of garden hose to the base of his trainers. Unlike with Nike, Federer could hunt for a footwear sponsor because Uniqlo does not make shoes. A sneaker nut who owns well over 250 pairs of trainers (not including ones he played in), Federer called On's founders for dinner in Zurich. Godsick also had a connection with them via an angel investment in the firm. Eventually, a deal was struck for Federer to buy a roughly 3 per cent stake in On Holding and to spend time in its lab designing his own shoe. On is now worth close to US$17 billion, making Federer's stake at least US$500 million, according to Bloomberg's wealth index. Federer has so far avoided overexposure via commentary roles or dubious sponsorships. He recently waved the French flag to start the Le Mans endurance car race, and launched a new Uniqlo clothing collection in Paris. He's also likely to be at Wimbledon – home to his greatest triumphs – when it begins next week. BLOOMBERG
Business Times
3 hours ago
- Business Times
BlackRock, Mubadala unwind partnership for Asia private credit: sources
[HONG KONG] BlackRock and Mubadala Investment have mutually agreed to unwind their Asian private credit partnership that focuses on investments in China and Indonesia due to challenges in sourcing deals, according to people familiar with the matter. Under the partnership, which started in 2023, the Abu Dhabi state-owned investment firm was to match every US dollar that BlackRock agreed to put in, said the people, who requested not to be named because the information is private. The world's largest asset allocators are forging alliances with private credit funds to capitalise on the rapidly expanding US$1.7 trillion private credit market. Mubadala is one of the most active investors in the space, building a portfolio of 73.5 billion dirhams (S$25.5 billion), backed by collaborations with firms including Apollo Global Management, Carlyle Group, and KKR. BlackRock did not respond to a request for comment. Mubadala declined to comment. The partnership has deployed only a limited amount of capital. Originating deals in China is proving difficult given the mid-teens return profile it's targeting, said the people. The head of private credit in Indonesia, Christopher Ganis, left in the early days of the collaboration for sovereign wealth fund Indonesia Investment Authority. That's made it difficult for deal origination in the country, the people added. BlackRock's head of Asia-Pacific private credit, Celia Yan, also left to join Apollo recently, just as the firm is finalising its integration with HPS Investment Partners. BlackRock last year agreed to buy HPS in an all-stock deal valued at about US$12 billion. The transaction is expected to be completed in the middle of this year, pending regulatory approval. The combined platform will expand to a team of 22 private market investment professionals with senior investor additions in Singapore and Sydney, according to an internal memo. BLOOMBERG
Business Times
4 hours ago
- Business Times
CCCS okays Tamarind Health's proposed acquisition of TalkMed
[SINGAPORE] The Competition and Consumer Commission of Singapore (CCCS) has cleared Tamarind Health's proposed acquisition of tertiary healthcare service provider TalkMed Group on Friday (Jun 27). The competition watchdog assessed that the proposed transaction will not substantially lessen competition within the Singapore market. TW Troy, a special purpose vehicle managed by Tamarind Health, proposed to privatise mainboard-listed TalkMed by way of scheme of arrangement, at S$0.456 per share, on Dec 23, 2024. CCCS said it commenced its review on Jan 13 to see whether the proposed privatisation would infringe Section 54 of the Competition Act 2004, which prohibits mergers that may substantially lessen competition. It conducted a public consultation from Jan 21 to 31, seeking feedback from stakeholders such as the involved parties' competitors and insurance service providers. Based on its assessment of the parties' submissions and third-party feedback, CCCS concluded that the proposed transaction is unlikely to substantially lessen competition in Singapore in relation to the supply of private medical oncology services. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Medical oncology refers to the field of medicine that deals with the treatment of cancer primarily with drugs, such as chemotherapy. CCCS reasoned that patients can choose alternative providers of medical oncology services in both public and private sectors in Singapore, limiting the impact of the proposed merger. Furthermore, it added that any increase in the parties' market power upon the proposed transaction would likely be constrained by insurers – who play a 'significant role' in affecting how patients select and finance private medical oncology services – as well as the regulatory framework governing the healthcare sector in Singapore. Tamarind is a pan-Asian oncology-focused group headquartered in Singapore. It is controlled by alternative asset manager Templewater and its affiliates. As part of the deal, 65 Equity Partners, a Singapore-based global investment firm backed by Temasek, will subscribe for shares in Tamarind Health through its local enterprise fund. After the transaction, 65 Equity Partners will hold about 18.3 per cent of the voting interest in Tamarind Health, while doctor shareholders will hold about 31.3 per cent. Shares of TalkMed closed flat at S$0.45 on Friday, before CCCS' announcement.
