20 Bahts (Prince Damrong Rajanubhab) – Thailand

In 2012, Thailand's currency, the baht (THB), was characterized by significant strength and volatility, largely driven by global macroeconomic forces. As a major emerging economy, Thailand attracted substantial foreign capital inflows seeking higher yields, especially as developed nations like the United States and the Eurozone maintained ultra-low interest rates following the 2008 financial crisis. This influx of "hot money" into Thai stocks and bonds placed persistent upward pressure on the baht, raising concerns among exporters about eroded international competitiveness for key sectors like electronics, automobiles, and rice.

The government, led by Prime Minister Yingluck Shinawatra, and the Bank of Thailand (BOT) faced a complex policy dilemma. While a strong baht helped contain inflation and lowered the cost of imports, authorities were wary of its negative impact on the crucial export sector, which accounted for over 60% of GDP. In response, the BOT implemented a series of measures, including interest rate cuts and direct intervention in foreign exchange markets to slow the baht's appreciation. These actions, however, drew criticism and scrutiny from abroad, with the United States briefly placing Thailand on its "Monitoring List" for currency practices in late 2012.

Ultimately, the currency situation reflected Thailand's vulnerability to external financial currents. The strong baht was a symptom of its relative economic success and stability in the region, yet it also highlighted the challenges of managing an open economy during a period of unprecedented global monetary easing. The tensions between supporting growth through exports and maintaining financial stability set the stage for ongoing policy debates regarding capital controls and macroprudential measures in the years that followed.