VIENTIANE, Sept. 5 (Xinhua) -- The Lao central bank imposed measures to stop further depreciation of the Lao kip against international currencies, according to a newsletter published by the bank earlier this week.
To prevent the kip from sliding further against the U.S. dollar and Thai baht, the bank has adjusted the money supply at a level that is relevant to the current socio-economic context.
In addition, the Lao central bank has been applying the managed floating exchange rate regime to keep the value of the Lao kip more stable, according to the newsletter.
The Lao central bank said one of the most effective ways to stabilize the Lao kip is to limit the demand and increase the supply of foreign currencies in the country, local daily Vientiane Times reported on Thursday.
In this regard, the bank demanded the participation of all sectors and the public to support and promote investment in businesses that produce goods for the international market.
The bank also called to do more to promote the domestic tourism industry as this sector generates a significant amount of foreign currency.
The Lao central bank said one of the main factors causing the Lao kip to fall in value is the rising value of the U.S. dollar and Thai baht in recent months.
The value of the U.S. dollar against the Euro rose by 1.5 percent over the first eight months of 2019, while the Thai baht increased in value by 3.5 percent against the U.S. dollar. With the strengthening of these two currencies on the international market, a fall in the value of the Lao kip is inevitable, the bank said in its newsletter, outlining the current situation on money exchange management.
According to data from Lao commercial bank Banque Pour Le Commerce Exterieur Lao (BCEL), the exchange rate on Wednesday was 290 Lao kip per Thai baht, and 8,790 Lao kip per U.S. dollar. On the open market, the exchange rate was at least 300 Lao kip per Thai baht, and over 9,000 Lao kip against the U.S. dollar.