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Despite modest economic growth, uneven tourism recovery, and ongoing political uncertainty, the Thai baht has remained surprisingly strong against the US dollar. At first glance, this may seem positive. Normally, a strong currency suggests economic confidence, supported by factors such as stable politics, strong exports, high interest rates, or large foreign investment. However, Thailand does not clearly meet many of these conditions today. This raises an important question: what does a strong currency really mean in the current regional economy?
Thailand’s economic performance has been weaker than several neighbouring countries. In addition, political leadership changed several times in 2025, creating uncertainty. Border tensions with Cambodia have added further pressure. Tourism, which has long been a key part of Thailand’s economy, has not fully recovered to pre-pandemic levels. Bangkok was also absent from BBC Travel’s recent list of the world’s top travel destinations, which suggests weaker tourism confidence.
Despite these challenges, the Thai baht has continued to strengthen. This gap between economic fundamentals and currency performance has attracted attention from analysts. A recent Asia Times article argues that this situation deserves careful analysis rather than simple explanations.
One possible explanation discussed is the role of non-traditional financial inflows. These include money linked to online scams and cyber-fraud networks that operate across mainland Southeast Asia. Such activities are common in border areas where law enforcement is weak. According to research institutions such as the ISEAS–Yusof Ishak Institute, Thailand plays an important role in this regional financial network, both as a transit point and as a financial centre.
Money earned through digital scams cannot remain in online form forever. Eventually, it must be converted into real currency. This conversion often happens in countries with open financial systems and large banking sectors. Thailand, as one of the region’s more developed financial markets, is therefore likely to receive some of these flows.
This leads to a sensitive but reasonable question: could part of the baht’s strength be influenced by unreported or under-measured money entering the financial system?
Even small amounts of illegal or unreported funds can affect exchange rates, especially when normal investment and trade flows are weak. During periods of low market activity, small increases in demand for a currency can lead to noticeable changes in its value.
The main concern is not whether illegal money exists, as this is widely recognised. Instead, the issue is whether these flows are large and consistent enough to distort economic signals. If exchange rates no longer reflect real economic conditions, they may give a false impression of stability.
A strong currency is usually seen as a positive sign. However, when it is not supported by strong fundamentals, it may hide deeper economic weaknesses. Therefore, the problem is not about morality, but about misleading economic signals.
Importantly, Asia Times does not claim that scam-related money directly caused the baht’s appreciation. It only suggests that under-measured inflows may play a small role. This issue is not unique to Thailand. Other open economies in the region, including Cambodia, face similar risks.
In conclusion, currency strength alone is no longer a reliable measure of economic health. In today’s world of digital finance and hidden capital flows, a stable exchange rate may conceal underlying economic problems.
Author: PanhaCHEZDA