The Bank of Thailand (BOT) on Monday announced new foreign exchange rules that will allow more flexible transactions and support capital movement, as the baht hits record lows amid volatility.
The new rules include reduced limits on transfers and removing required supporting documents for making transactions. The central bank will also firms to conduct more hedging to better manage its exposure to foreign exchange risks.
Limits on yearly lending to unaffiliated companies, which is currently capped at $50 million, will be removed along with limits on purchases of immovable properties abroad.
Thai companies will be allowed to buy foreign currencies for transfer domestically as necessary. Transfers were previously allowed only through foreign currency deposit, the statement said.
Bank customers who have undergone their banks’ Know-Your-Business process will no longer be asked for supporting documents when making transactions.
“This would enable exporters, importers, and those in the supply chain to better manage their foreign exchange risks more efficiently,” said BOT.
The baht has been swinging above 33 in the recent week and is expected to move between 33.30 and 33.80 this week.
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