Thailand: Four cabinet Ministers resigns – ANZ

USD/THB is up 0.40% on the day to 31.65 after four cabinet Ministers submitted their resignations. Economists at ANZ Bank expects this reaction to be short-lived as the policy is set to be unchanged.

Key quotes

“Four cabinet Ministers, including Finance Minister Uttama Savanayana and Deputy Prime Minister Somkid Jatusripitak, officially submitted their resignations. The development was not entirely unexpected.”

“Importantly, we do not expect any major changes to Thailand’s economic policy, which will remain focused on engineering a recovery. We also do not expect this political development to affect budget approval in parliament - the FY2021 budget bill has passed the first reading so far.”

“The reaction of the THB has been mildly negative. It is likely to be short-lived as economic policies are unlikely to change and political uncertainty is not new to Thailand.”

“ We also expect safe haven demand for government bonds from onshore investors to pick up temporarily. We expect no change in current financing plans and the issuance schedule in Q4 FY2020 (fiscal year ending September 2020).”