BOT urges hedging against currency risk
Bank of Thailand governor Veerathai Santiprabhob on April 19 urged exporters to hedge against volatility in the value of the baht as the country faced the prospect of trade protectionism against the backdrop of tensions on the Korean Peninsula – with “unpredictable” outcomes from the latter. “Geopolitical risk and trade protectionism are external risks factors that could lead to high volatility in the exchange rate,” Veerathai said. His comments follow a period of gains in the baht, confounding market assumptions that the currency would weaken against the US dollar. Market bets since last year been for the greenback to strengthen against the major currencies this year in line with the US Federal Reserve’s policy goal of raising interest rates to more normal levels.
