The Bank of Thailand and the central banks of Indonesia, Malaysia and the Philippines have signed a memorandum of understanding to promote local currency settlement of bilateral trade, investment and other eligible transactions. The agreement brings the Philippines into the cooperation framework and supersedes bilateral agreements concluded among the Indonesian, Malaysian and Thai central banks in August 2023.
The Local Currency Transaction Framework aims to improve settlement efficiency, reduce costs associated with multiple currency conversions and give businesses greater flexibility in managing foreign exchange risks. The agreement follows the three original participants’ expansion of their appointed dealer bank network in August 2025 to facilitate local currency settlements and improve access to local currency liquidity.