Foreign loans with a maturity of less than 180 days used to pay for exports will also be exempt from capital controls, Suchart Sakkankosone, director of the exchange control department, told reporters at a briefing in Bangkok. The changes will take effect tomorrow.

"The relaxation for some transactions will provide companies in Thailand more options in raising foreign loans for their business, not for speculation on the baht," Suchart said. "It makes sure that those loans and borrowings will not have an impact on the baht's volatility."

The Bank of Thailand triggered a slump in local stocks, bonds and the currency in December when it imposed capital controls, then reversed some of the measures a day later. The bank last week cut its key interest rate for the first time in more than three years to spur the economy after confidence was shaken by new investment rules and bombings in Bangkok.

Companies investing in Thailand will be exempt from a requirement 30 percent of their funds borrowed abroad are withheld if the loan is fully hedged for at least a year, Governor Tarisa Watanagase said on Jan. 26. Short-term borrowing of less than a year are exempt if they hedge for the duration of the loan.

"We require loans to be hedged because it will help reduce volatility of the baht and make sure that they are long-term loans, and not used for speculative purposes," Suchart said.