After Military Coup, Thai Baht Extends Biggest Loss Since 2002
This article is from the archive of The New York Sun before the launch of its new website in 2022. The Sun has neither altered nor updated such articles but will seek to correct any errors, mis-categorizations or other problems introduced during transfer.
The Thai baht extended the biggest loss in four years after the military yesterday seized control of Bangkok from Prime Minister Thaksin Shinawatra. Government departments, banks and the Stock Exchange were ordered to close.
The currency slumped yesterday as tanks rolled into the capital while Mr. Thaksin was in New York attending meetings at the United Nations. He has faced increasing pressure to step down since heading a caretaker government after dissolving Parliament in February.The coup leaders said they revoked the state of emergency that Mr. Thaksin had called earlier.
“I would tend not to downplay the impact this could cause on Thailand’s financial markets,” a vice president of foreign exchange research at Brown Brothers Harriman & Co.,Nick Bennenbroek, said.
The baht fell 0.1% to 37.80 per dollar at 6:35 a.m. in Bangkok, from 37.77 late in New York yesterday, when it dropped 1.3%, the biggest decline since July 2002. Thai bonds and a New York-traded fund of the nation’s stocks also declined yesterday.
Shares of mutual funds that invest in Thailand dropped in American trading yesterday. Thai Fund Inc. fell 3.7% to $8.65 after tumbling as much as 7.1%.
“It’s a military coup to oust the prime minister, and the implications are not obviously favorable,” the founder and managing director of investment firm Marc Faber Ltd., Marc Faber, said.