Bank of Thailand sees risk from high trade surplus with US
TL;DR
Bank of Thailand acknowledges risks from a high trade surplus with the US, which led to inclusion on a US monitoring list. The central bank emphasizes its currency policies aim to stabilize the baht, not manipulate rates, while addressing challenges like export competitiveness and economic growth.
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Bank of Thailand sees risk from high trade surplus with US
Bank of Thailand Navigates Risks from Elevated Trade Surplus with U.S.
Thailand's trade surplus with the United States has drawn attention from the Bank of Thailand (BOT), as the country was recently placed on the U.S. Treasury's currency "Monitoring List" for meeting two of three criteria: a significant trade surplus with the U.S. and a global current account surplus exceeding 3% of GDP according to reports. The BOT has acknowledged the risks associated with this surplus, which reached $17.7 billion in 2024–2025, but insists its currency management policies remain focused on stabilizing the baht rather than manipulating exchange rates for competitive advantage.
The U.S. Treasury's semi-annual report highlighted Thailand's current account surplus of 3.8% of GDP during July 2024–June 2025, exceeding the 3% threshold for scrutiny. Assistant Governor Chayawadee Chai-anant emphasized that the central bank's "two-sided" intervention strategy—managing both appreciation and depreciation of the baht— ensures alignment with economic fundamentals. This approach, she noted, provides flexibility to address volatility without breaching U.S. criteria.
The strong baht, which rose 9% in 2025 and an additional 0.3% in early 2026, poses challenges for export competitiveness, particularly in key sectors like electronics and tourism. To mitigate this, the BOT has introduced gold trade restrictions, blaming speculative gold trading for exacerbating currency appreciation. These measures aim to curb inflows driving up the baht while balancing domestic demand growth, which contributed to Thailand's 2.2% economic expansion in 2025.
Despite the U.S. designation, the BOT downplays risks of being labeled a "currency manipulator," noting no country received this label in the latest report. Officials stress that the monitoring list is a tool for observation, not a precursor to sanctions, and that trade negotiations remain separate from currency practices according to central bank officials.
Looking ahead, the BOT forecasts 1.5% economic growth for 2026, though risks persist from U.S. tariffs, geopolitical tensions, and a widening trade deficit with China. The central bank remains focused on stabilizing the baht while adapting to evolving global trade dynamics.
