No replies to this topic

[DollyLamma]

There's a lot of talk in the news about how much higher the baht is going to go when the BOT lifts its foreign money controls tomorrow. According to this article, the Thais say thay are going to issue bonds to manage the baht. To be honest, I don't understand what bonds have to do with keeping the baht low.

"The Bank of Thailand and the Finance Ministry will jointly manage the exchange rate through the market mechanism, following tomorrow's end to 14 months of hard-knuckled capital controls. Tarisa Watanagase, the central-bank governor, told Nation Channel yesterday that the new BOT Act would go into effect tomorrow and the Finance Ministry had a new public-debt management law to rein in the baht.

Both laws let the central bank and Finance Ministry issue an unlimited amount of bonds to manage the demand for and supply of foreign exchange as a means to stabilise the baht, which will likely shoot up after the 30-per-cent reserve requirement is lifted."

http://www.nationmultimedia.com/worldhotne...newsid=30066990