Thailand's baht jumped to a four-month high on Thursday, the day the country's military controlled Parliament completed the first reading of a bill that aims to restrict political demonstrations.

USD/THB fell to 32.34, its lowest since late October, and from the previous close of 32.51. The move means the baht has rallied 0.5% on the day.

The Thai currency has been trending higher after hitting a medium term trough at 33.12/dollar in December. The baht has strengthened 2.4% from the near two-year low of December by Thursday.

Official stance is that the law aims to 'giving order to political protests' and not to prevent demonstrations, but critics opine that the government really wants to tighten its grip over public gatherings, a Reuters report said.

The National Legislative Assembly should complete a second and third reading of the bill for it has to become law and that seems easy as the assembly has members nominated by the military.

The Thai economy has been seeing GDP growth rate inching higher after contracting 0.5% in the first quarter of 2014. By the fourth quarter, the annual growth rate ha risen to 2.3%, its highest since Q2 2013.

At the same time, the country dipped into deflation as per the January inflation data. Thailand has been seeing disinflation ever since the price rate registered a medium term high at 2.62% in May last year. At the end of the year, it was 0.6%, and in January, -0.41%.