what's going on with the Thai Baht

[Franko666]

On 10/5/2018 at 9:55 AM, quandow said:

NOT defending Trump here, far from it! However, it hasn't been 36 baht to the dollar since 2017. It was a good year in 2016, THEN the REALITY of what the pussy-grabber-in-chief was up to, and it's been in a downward slump ever since.

https://www.poundsterlinglive.com/bank-of-england-spot/historical-spot-exchange-rates/usd/USD-to-THB

Thats funny, especially coming from a Thai forum where someone want to grab your balls every 100 metres.

[wazzupnow]

whats the problem all my money is thai baht now. so?

[simoh1490]

It looks like THB could be in the process of changing: tourism is thought to be taking a hit and the volume of Chinese tourists dropping quite significantly, exports are also believed to be ready to fall up to 20% on the back of the trade war, and, capital inflows are approaching 2012 low falls of THB 200 bill., good news for some, bad news for others.

[morrobay]

3 hours ago, simoh1490 said:

It looks like THB could be in the process of changing: tourism is thought to be taking a hit and the volume of Chinese tourists dropping quite significantly, exports are also believed to be ready to fall up to 20% on the back of the trade war, and, capital inflows are approaching 2012 low falls of THB 200 bill., good news for some, bad news for others.

Do you mean Chinese exports or Thai exports to fall 20% ? And capital inflows falling in China or falling in Thailand or both ?   

[simoh1490]

2 hours ago, morrobay said:

Do you mean Chinese exports or Thai exports to fall 20% ? And capital inflows falling in China or falling in Thailand or both ?   

I mean Thai exports will fall by 20% and capital outflows from Thailand have increased to THB 200 bill.

Edited October 11, 2018 by simoh1490

[simoh1490]

2 hours ago, morrobay said:

Do you mean Chinese exports or Thai exports to fall 20% ? And capital inflows falling in China or falling in Thailand or both ?   

double post

Edited October 11, 2018 by simoh1490

[morrobay]

1 hour ago, simoh1490 said:

I mean Thai exports will fall by 20% and capital outflows from Thailand have increased to THB 200 bill.

20% !  Can you elaborate on how this happening on back of trade war with China? 

Edited October 11, 2018 by morrobay

[simoh1490]

41 minutes ago, morrobay said:

20% !  Can you elaborate on how this happening on back of trade war with China? 

I was reading the Nation over lunch yesterday there's a piece in there on this subject - I'd post some links to articles but my internet is lousy at present, but if you plug the keywords into your browser there's a bunch of stuff out there, particularly K-bank research. Basically, it evolves from reduced demand from China for electronic goods and automobiles.

[morrobay]

30 minutes ago, simoh1490 said:

I was reading the Nation over lunch yesterday there's a piece in there on this subject - I'd post some links to articles but my internet is lousy at present, but if you plug the keywords into your browser there's a bunch of stuff out there, particularly K-bank research. Basically, it evolves from reduced demand from China for electronic goods and automobiles.

OK, K-bank research says net negative effect from trade war going past 2018 = $ 4.5 billion. And from search Thai export value is $ 22 billion. So about a 20% drop. You always say baht value is from demand, tourism and exports. So if there is no significant baht depreciation then manipulation would be suspected. 

[simoh1490]

4 minutes ago, morrobay said:

OK, K-bank research says net negative effect from trade war going past 2018 = $ 4.5 billion. And from search Thai export value is $ 22 billion. So about a 20% drop. You always say baht value is from demand, tourism and exports. So if there is no significant baht depreciation then manipulation would be suspected. 

Exports are USD 236 bill.http://www.worldstopexports.com/thailands-top-10-exports/

[morrobay]

Then the export drop would be 2 %

[simoh1490]

8 minutes ago, morrobay said:

Then the export drop would be 2 %

We're starting from different points on this, my starting point is:

 

Thailand GDP = circa USD 418 bill., exports represents = circa USD 236 bill.....it has been said that the trade war will cost Thailand up to 20% of it's exports for the reasons stated earlier. I haven't dug into the detail of why or how, above and beyond what I've said above....but I will.

 

TO ADD: 

"China is Thailand’s largest export market, with export share of 12.4 per cent last year, while the US is Thailand’s second-largest market with export share of 11.2 per cent.

A trade war between the two will result in losses for both the US and China". 

http://www.nationmultimedia.com/detail/business/30341617

Edited October 11, 2018 by simoh1490

[mfd101]

5 minutes ago, simoh1490 said:

A trade war between the two will result in losses for both the US and China". 

And the losses for Thailand will be? ...

[simoh1490]

2 minutes ago, mfd101 said:

And the losses for Thailand will be? ...

That's not my quote, that's a quote from the Nation.

[mfd101]

26 minutes ago, simoh1490 said:

That's not my quote, that's a quote from the Nation.

Sure, but the thread is about the Thai baht. The concept, as I understand it, is that the US/China trade war will damage the Thai economy as collateral damage (much as the Oz economy may suffer).

 

The question is: How much? Noone knows. And how will this affect the value of the Thai currency? Noone knows.

[simoh1490]

1 minute ago, mfd101 said:

Sure, but the thread is about the Thai baht. The concept, as I understand it, is that the US/China trade war will damage the Thai economy as collateral damage (much as the Oz economy may suffer).

 

The question is: How much? Noone knows. And how will this affect the value of the Thai currency? Noone knows.

The value of THB is determined by demand, demand is found in three significant areas, tourism receipts, exports and capital flows. As already said, one economy watcher is suggesting a 20% fall in export values plus the demand from Chinese tourism has fallen, as has the value of capital flows, significantly I might add. If those three factors don't combine to stunt the growth of THB I don't know what will.

[mfd101]

7 minutes ago, simoh1490 said:

The value of THB is determined by demand, demand is found in three significant areas, tourism receipts, exports and capital flows. As already said, one economy watcher is suggesting a 20% fall in export values plus the demand from Chinese tourism has fallen, as has the value of capital flows, significantly I might add. If those three factors don't combine to stunt the growth of THB I don't know what will.

Fine, but there's no predictive value in that. What does 'stunt the growth' mean for, say, the next 12 months? Instead of, say, 10% growth in the Baht's value, it'll grow by only 7%? or 2% or fall by 3%? ...

[morrobay]

Shouldn't that be in context here: if those 3 factors do not depreciate the baht I don't know what will. 

Edited October 11, 2018 by morrobay

[soalbundy]

Thai Baht strong, farang currency weak ! There will be several years of this, on my deathbed the Baht will fall.

[simoh1490]

33 minutes ago, mfd101 said:

Fine, but there's no predictive value in that. What does 'stunt the growth' mean for, say, the next 12 months? Instead of, say, 10% growth in the Baht's value, it'll grow by only 7%? or 2% or fall by 3%? ...

If you're looking for crystal ball type answers I can't help, I haven't even looked at this subject having been outside Thailand for the past three months hence I've done absolutely zero reading on the subject. What I do know is that the landscape is changing and potentially quite significantly, in due course I may be able to get sufficient of a feel for events to be able to quantify things.

[simoh1490]

36 minutes ago, morrobay said:

Shouldn't that be in context here: if those 3 factors do not depreciate the baht I don't know what will. 

Exactly. I can imagine one scenario where Thai exports do fall significantly, tourism falters by a large amount and capital outflows increase. At the same time the UK comes up with an agreeable Brexit solution and the value of the Pound soars giving us 50 or so. Alternatively, I can also imagine a scenario where there is no agreeable Brexit solution but all the other things hold true and the status quo is maintained. It's a mix and match scenario over time, the components that affect the outcome are well known, their future course and values however are very unclear.

[mogandave]

If I knew how the currency was going to move I would never work another day.

[simoh1490]

Some pieces of the puzzle:

 

"Thailand recorded a USD 588 million trade deficit in August, widening from July’s USD 516 million deficit (previously reported: USD 525 million deficit) and contrasting August 2017’s notable trade surplus. This marked the fourth trade deficit in the last eight months and highlights the change of fortunes of Thailand’s external sector. Meanwhile, the 12-month moving sum of the trade balance dropped from USD 10.6 billion in July to USD 7.7 billion in August, the lowest reading in three years.

 

Export growth eased to 6.7% year-on-year in USD value terms in August, down from 8.3% in the previous month but nonetheless beating market expectations of 5.0% growth. Growth in exports was supported by robust foreign demand for motor cars; plastic products; and machinery and mechanical components. China, U.S. and Japan continued to be the main trading partners. Imports grew 22.8% over the same month a year ago in August, up from 10.5% in July@.

 

https://www.focus-economics.com/country-indicator/thailand/exports

 

And then:

https://www.imf.org/en/News/Articles/2018/06/07/NA060818-Thailands-Economic-Outlook-in-Six-Charts

 

[Percy P]

The reason the Baht is strong is it's very much in demand . The more tourists arrive the more the Baht is in demand .Currencies exchange. The economy is not to strong but the foreign reserve makes up for it. The foreign reserve will cover all of Thailand debts.The treasury learnt from the 1989 economic problem. So it's tourists who are making the Baht stronger, but are the people benefiting from it when charities registered with the Government still asking the public for donations. Western tourists are almost paying twice as much for the same item as in 2008 so they are exchanging twice the amount as before 2008.

Edited October 16, 2018 by Percy P
Addition

[simoh1490]

2 hours ago, Percy P said:

The reason the Baht is strong is it's very much in demand . The more tourists arrive the more the Baht is in demand .Currencies exchange. The economy is not to strong but the foreign reserve makes up for it. The foreign reserve will cover all of Thailand debts.The treasury learnt from the 1989 economic problem. So it's tourists who are making the Baht stronger, but are the people benefiting from it when charities registered with the Government still asking the public for donations. Western tourists are almost paying twice as much for the same item as in 2008 so they are exchanging twice the amount as before 2008.

1989....you mean 1997!

 

tourism represents 22% of GDP but exports represent a much higher percentage, over 62% and that is money that places a demand for H as export bills are converted into baht.

[talahtnut]

Western debt based economies reliant on consumerism

have no way to go but down.

Rama 9 promoted a self sufficiency economy,

that's the way to go.

[stud858]

I've just been punched in the guts. Heading in to Thailand soon. Checked the xrate.  Aud buggered.

22.9 in website. Anybody can tell me the street rate?

[Stocky]

9 minutes ago, stud858 said:

I've just been punched in the guts. Heading in to Thailand soon. Checked the xrate.  Aud buggered.

22.9 in website. Anybody can tell me the street rate?

Super Rich 22.75

[RotBenz8888]

On 10/11/2018 at 12:09 PM, simoh1490 said:

The value of THB is determined by demand, demand is found in three significant areas, tourism receipts, exports and capital flows. As already said, one economy watcher is suggesting a 20% fall in export values plus the demand from Chinese tourism has fallen, as has the value of capital flows, significantly I might add. If those three factors don't combine to stunt the growth of THB I don't know what will.

The ultimate factor happens when the Thai property bubble bursts. Fantasy world's doesn't last Forever.  

[spidermike007]

It appears at the moment, that the US dollar, the pound sterling and the Euro are having some real issues. The dollar seems particularly weak, and it is understandable considering the inconsistency, and destructive nature of Trump economic and trade policies, and the trade war he is conducting, without wisdom or intelligent guidance. It seems the Thai baht's stability is somewhat counter to all of that. It has to be taking a toll on tourism, which is already weak (if you exclude the zero to very little baht Chinese tourists), we are witnessing the softest peak season in decades, and one would think exports would be considerably less competitive. In addition, there is a huge amount of unsold property on the market, and prices do not seem to be dropping commensurate with the lack of demand for it. 

 

Is it safe to reason that all of this is going to take a toll on the economy eventually?