Thai baht notes. Photo: Reuters/Athit Perawongmetha

BANGKOK (Reuters) – Thailand’s central bank governor said on Tuesday a rapid rise in the baht was not good for the country’s economic recovery although it was not causing exports to decline.

Thai exports have faced several problems, including falling behind in technology innovation and a slow recovery in export markets, Bank of Thailand Governor Veerathai Santiprabhob, told reporters.

Thai baht notes are seen at a Kasikornbank in Bangkok, Thailand, May 12, 2016. REUTERS/Athit Perawongmetha

But the baht’s rapid appreciation in certain periods “is not conducive to the economic recovery and the central bank will closely monitor it,” he said.

The baht was at 34.62 per dollar on Tuesday, hovering around its highest level in more than a year, driven by foreign fund inflows.

The currency has risen by 4% against the dollar this year, and Veerathai said its strength was not greater than other regional currencies.

The central bank expects exports to fall for a fourth straight year in 2016.

(Reporting by Kitiphong Thaichareon; Writing by Orathai Sriring; Editing by Jacqueline Wong)

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