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Thailands's Foreign Exchange

Thailand rules out fixing exchange rate

BANGKOK - Thailand on Monday ruled out returning to a fixed exchange rate to stop the baht's rise against the dollar but said the government was trying to stabilise the currency.

'The current, flexible managed-float system is able to manage the risks.

Many countries are using the same approach. The fixed basket system is out of date,' Finance Minister Chalongphob Sussangkarn told reporters.

Thailand maintained a fixed exchange rate until 1997, when the currency came under speculative attack and the central bank exhausted its foreign reserves trying to defend it.

The decision to finally float the baht sparked the Asian financial crisis, sinking economies around the region.

Army-installed Prime Minister Surayud Chulanont said the government was trying to keep the baht from gaining too quickly after the currency appreciated 7 per cent since the begining of this year, following a 12 per cent gain in 2006.