Thailand to allow public to open US dollar bank accounts to slow baht’s rise

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BANGKOK, Thailand (Thomson Financial) – The Bank of Thailand said
Thursday it would allow the public to open US dollar-denominated bank
accounts in a bid to curb the baht’s rise.

The Thai currency is hovering at around 10-year highs against the greenback.

Under the measure, ordinary Thais can own domestic bank deposits worth
up to 100,000 dollars, central bank governor Tarisa Watanagase said,
adding the scheme was part of a package aimed at reducing upward
pressure on the baht.

The central bank will present the package to Prime Minister Surayud Chulanont’s cabinet for approval next Tuesday.

Under current rules, Thai firms can hold dollar-denominated bank accounts here but the public was not allowed to do so.

On Wednesday, the central bank slashed its key interest rate by 25
basis points to 3.25 percent, the fifth consecutive rate cut this year,
as it sought to rein in the rising baht.

The strong baht has put pressure on exports, the key driver of the Thai economy.

However the rate cut had little impact as the Thai currency was quoted
at 33.49-51 to the dollar in morning trade Thursday, compared to
Wednesday’s close of 33.46-48.

afp/mb

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