Thailand not a currency manipulator, central bank chief says

[webfact]

Thailand not a currency manipulator, central bank chief says

Gov Veerathai warns US trade protectionism could hurt global investment

YUKAKO ONO, Nikkei staff writer

 

BANGKOK -- Thailand does not intervene with foreign exchange rates to gain competitiveness in trade, its central bank chief said on Monday, amid rising concerns that the country may become the first in Southeast Asia to be placed under trade scrutiny by the U.S.

 

In an interview with the Nikkei Asian Review, Bank of Thailand Governor Veerathai Santiprabhob stressed that the Thai baht had been moving in line with market supply and demand, pointing out that the currency had been strengthening in the past year or so to become one of the best-performing currencies in the region due to capital inflows from advanced economies.

 

"We have no policies of fixing exchange rates at a particular level of manipulating exchange rate to a particular level," he said.

 

Full story: https://asia.nikkei.com/Economy/Thailand-not-a-currency-manipulator-central-bank-chief-says

 

-- NIKKEI ASIAN REVIEW 2018-04-24

[geriatrickid]

It doesn't make sense. If the allegation is that Thailand keeps its baht artificially low, why then are the pages of the forum filled with complaints from foreigners  of how poorly their  home currency does against  the baht.  One would expect an exchange rate that delivered extra baht into the pudgy fingers of us all.

 

My national currency has done rather poorly against the baht and if the central bank is conspiring to keep the baht low, then I would be  grateful if they would do something about my shrinking exchange results.  In plain language, gimme some love y'all.

[Artisi]

No Thai would ever do anything to manipulate their advantage when it comes to money - would they - nah! 

[Sealbash]

No Thai would ever do anything to manipulate their advantage when it comes to money - would they - nah! 

Other than wanting to have the distinction of the first Thai bash on this thread, do you have any factual evidence as to where the BoT has made any moves to manipulate yet he currency?


Sent from my iPad using Thailand Forum - Thaivisa mobile app

[Watchful]

My sense is the BoT governor is correct in the Thailand is NOT manipulating the value of THB.  If they were trying to make Thailand's products more competitive via currency controls, they have bungled it badly because it is going the other way.

 

As for US protectionism, Thailand has something to fear in Trump.  When Thailand exports to the US are hit with 2 and 3% charges and US exports to Thailand get hit with 40% charges ... YES there is a problem. Thailand may view this as "free trade", but it's far, far from Trump's idea of free trade.  

[simoh1490]

If anyone is a currency manipulator it's the US, the Fed. has purposely devalued USD by 10% in order to make their exports more attractive and this improves the exchange rates against overseas currencies - I don't see Thailand keeping their currency low, how can they possibly do that when the yardstick against which it is measured is falling like a stone! BOT has been actively trying to weaken THB but it's a losing battle, perhaps higher oil prices will help that.

[mikebell]

Can you believe the word of a Thai banker?  I said Banker.

[ChrisY1]

So why is the Baht so high?

The economy is tanking....there's almost zero growth...the military run the place...corruption is wrecking the public sector....

I don't know really how currency is manipulated, but something isn't right!

[Curmudgeon1]

4 minutes ago, ChrisY1 said:

So why is the Baht so high?

The economy is tanking....there's almost zero growth...the military run the place...corruption is wrecking the public sector....

I don't know really how currency is manipulated, but something isn't right!

Zero growth... tanking? Explain

[lapamita]

25 minutes ago, mikebell said:

Can you believe the word of a Thai banker?  I said Banker.

 I more belive in thaibanks, rather than in western bankers. Look only at Tier1 capital and balances of thaibanks  compare to most  western banks.

 

The central bank is not intervining in the markets at the moment , and not for the last years.

The THB is strong due to heavy inflows on capital ( however why), bcs iinstituional investors calls it a  save heaven in aisa, after php and myr tumpeld.

 

i will think the  times of  a strong THB is over in the mdeium term , specially to the USD, their are many signs , in multi year charts ( weekly and monthly) , that we build a top in FX at aprox 31 .  a range of 34-36 , i think is reassy to reach over the next years...

 

and than the next people comming, saying they manipulate...

 

The last big intervention  in thailand , was during the end of the nintys, when they tryed to stable the baht , what failed ,with the result of loosing all foreign FX and  a fall of 50% in the currency.

 

thats long ago..............

 

@chris

 

why??

 

easy answer.. look at foreign dept compare to GDP,, its extremly low, compare to western countrys and even compare to the 90th in thailand,heavy consumer depts , second highets in asia, are financed locally in THB, so even from there no presure on the THB exportbills still growing even lower than expected, FX reserves on multi year highs,the political situation here is stable, bond and sahre markets are stable, dont look it  from  a toruist perspective,the outlook for pattaya and others is very  bad in my opinion, but thats only a tinny part of all. and pls corruption....ask you  self ? is there a better emerging country in the south east asia region than Thailand, NOT ONE !! except sinapore, but thts called developed

 

all info , good and easy undertandable on  web :  bot.co.th ( even in english)

[sammieuk1]

One part of the equation I have pondered is how Thai exports stay competitive with the bullet proof Baht together with exactly how big are the foreign currency reserves? this may shed some light in a tiny dark corner.      

[Watchful]

41 minutes ago, simoh1490 said:

If anyone is a currency manipulator it's the US, the Fed. has purposely devalued USD by 10% in order to make their exports more attractive and this improves the exchange rates against overseas currencies - I don't see Thailand keeping their currency low, how can they possibly do that when the yardstick against which it is measured is falling like a stone! BOT has been actively trying to weaken THB but it's a losing battle, perhaps higher oil prices will help that.

So your argument is the Fed is devaluing the US$ by raising interest rates to member banks?  Current speculation is minimum of 3 and an outside chance of 4 rate hikes in 2018.

 

For the record the US$ has increased in value over the Euro during the past 30 days.

[NCC1701A]

Thailand is doing great. Their economy is booming.

[simoh1490]

13 minutes ago, Watchful said:

So your argument is the Fed is devaluing the US$ by raising interest rates to member banks?  Current speculation is minimum of 3 and an outside chance of 4 rate hikes in 2018.

 

For the record the US$ has increased in value over the Euro during the past 30 days.

Here's the US Dollar Index, the basis on which the strength or weakness of USD is determined. Note it has recently come off long time lows of 89 and is now at 90, not at 100 where it was a year ago. Future rate increases by the Fed? The markets have already priced in that potential and they don't think much!

 

The Euro? The Euro is pants, the EU is in worse shape than the US. For the record the USD has decreased in value against the Euro in the past 30 days, please reference the above!

[KiwiKiwi]

21 minutes ago, NCC1701A said:

Thailand is doing great. Their economy is booming.

Maybe. Perhaps it's doing great if you look at it in isolation. If you compare with ASEAN neighbours, perhaps not so much. Though I may be behind the times and the rest of the world is eagerly awaiting the election... daft sods.

[simoh1490]

49 minutes ago, ChrisY1 said:

So why is the Baht so high?

The economy is tanking....there's almost zero growth...the military run the place...corruption is wrecking the public sector....

I don't know really how currency is manipulated, but something isn't right!

The Baht, like all currencies, strengthens or weakens based on demand. THB is in demand because Thailand is an export led economy where foreign exchange receipts in USD are converted into THB - ditto tourist demand for local currency, ditto overseas demand by foreign investors as a part of FDI.

[simoh1490]

Just now, KiwiKiwi said:

Maybe. Perhaps it's doing great if you look at it in isolation. If you compare with ASEAN neighbours, perhaps not so much. Though I may be behind the times and the rest of the world is eagerly awaiting the election... daft sods.

Elections, civil unrest, coups, they all have almost zero impact on the demand for THB, even when there were tanks on the streets in Bangkok it was so, it's simply not a factor.

[Watchful]

4 minutes ago, simoh1490 said:

Here's the US Dollar Index, the basis on which the strength or weakness of USD is determined. Note it has recently come off long time lows of 89 and is now at 90, not at 100 where it was a year ago. Future rate increases by the Fed? The markets have already priced in that potential and they don't think much!

 

The Euro? The Euro is pants, the EU is in worse shape than the US. For the record the USD has decreased in value against the Euro in the past 30 days, please reference the above!

Sorry, but you have that backwards.  Go to:

 

https://www.oanda.com/currency/converter/

 

Put in Euro and US$ and look at the 30 day graph on the page.

[nong38]

Thais seem to think its something to be proud of to have a high exchange rate after all it benefits those who have money and regularly travel abroad, the ordinary Thai is not affected much, does not understand what is going on and will in all likelihood never leave the kingdom after all they told that Thailand is the best place to live there is nothing for the average Thai t ever leave and find out there is a big world out there with many different things to explore.

[KiwiKiwi]

Just now, nong38 said:

Thais seem to think its something to be proud of to have a high exchange rate after all it benefits those who have money and regularly travel abroad, the ordinary Thai is not affected much, does not understand what is going on and will in all likelihood never leave the kingdom after all they told that Thailand is the best place to live there is nothing for the average Thai t ever leave and find out there is a big world out there with many different things to explore.

Indeed Thailand is a very small goldfish bowl where the goldfish aren't very bright so when the chief goldfish says there isn't a better goldfish bowl in the whole wide world, well, they naturally believe him.

 

Mugs.

[blackcab]

Exporting Baht out of Thailand is not simple and straightforward for everyone.

 

Do the export restrictions affect the value of the Baht?

 

If they do, what would happen to the Baht if the restrictions were lifted?

[simoh1490]

6 minutes ago, Watchful said:

Sorry, but you have that backwards.  Go to:

 

https://www.oanda.com/currency/converter/

 

Put in Euro and US$ and look at the 30 day graph on the page.

I understand that. But you have to go to the US Dollar Index and see how the value of USD has fallen over that period. You may well be getting more Euro for your Dollar but the intrinsic underlying value of USD has fallen hence the net of it all is very close to zero.

[simoh1490]

Just now, blackcab said:

Exporting Baht out of Thailand is not simple and straightforward for everyone.

 

Do the export restrictions affect the value of the Baht?

 

If they do, what would happen to the Baht if the restrictions were lifted?

BOT has been slowly lifting the restrictions on THB  by exporters. Previously they were required to repatriate and exchange foreign earnings within short timescales, they are now able to retain those earnings overseas and not to convert to THB although this is not a blanket rule. These changes were implemented by BOT in order to reduce the upwards pressure on THB.

[Watchful]

3 minutes ago, simoh1490 said:

I understand that. But you have to go to the US Dollar Index and see how the value of USD has fallen over that period. You may well be getting more Euro for your Dollar but the intrinsic underlying value of USD has fallen hence the net of it all is very close to zero.

OK, I debunked your assertion that the US$ has devalued over the last thirty days vs the Euro.

 

The US$ index at the same time has gone UP ... yes UP over the same time period:

 

https://www.marketwatch.com/investing/index/dxy

(select 1M time period and look at resulting graph)

 

Perhaps YOU better start showing the references for your contentions.

[simoh1490]

2 minutes ago, Watchful said:

OK, I debunked your assertion that the US$ has devalued over the last thirty days vs the Euro.

 

The US$ index at the same time has gone UP ... yes UP over the same time period:

 

https://www.marketwatch.com/investing/index/dxy

(select 1M time period and look at resulting graph)

 

Perhaps YOU better start showing the references for your contentions.

Selecting one month on the US Dollar Index shows a range of between 89 and 91, about 2%.

 

Looking at the EUR/USD exchange rate over the same period shows a range of between 1.22 and 1.24, about 2%.

 

All of that is normal intra-day activity, there's a current 5 day trend that shows some slight strengthening but that's meaningless. Here's your link:

 

https://www.investing.com/currencies/eur-usd

 

 

[kaorop]

57 minutes ago, NCC1701A said:

Thailand is doing great. Their economy is booming.

not for many many thais, the local economy has been stagnant for years...

[Eric Loh]

28 minutes ago, simoh1490 said:

Elections, civil unrest, coups, they all have almost zero impact on the demand for THB, even when there were tanks on the streets in Bangkok it was so, it's simply not a factor.

Political stability is one of the key factor among other important factors like trade, debt to GDP, inflation and interest rate. When the coup was declared on 2014, the Baht dropped to around 34B to 1 USD. SET tanked and most foreign institutions took their stocks and bonds out of the country and parked in other countries. 

[simoh1490]

4 minutes ago, Eric Loh said:

Political stability is one of the key factor among other important factors like trade, debt to GDP, inflation and interest rate. When the coup was declared on 2014, the Baht dropped to around 34B to 1 USD. SET tanked and most foreign institutions took their stocks and bonds out of the country and parked in other countries. 

Rubbish!  https://www.xe.com/currencycharts/?from=USD&to=THB&view=5Y

[Watchful]

7 minutes ago, simoh1490 said:

Selecting one month on the US Dollar Index shows a range of between 89 and 91, about 2%.

 

Looking at the EUR/USD exchange rate over the same period shows a range of between 1.22 and 1.24, about 2%.

 

All of that is normal intra-day activity, there's a current 5 day trend that shows some slight strengthening but that's meaningless. Here's your link:

 

https://www.investing.com/currencies/eur-usd

 

 

Ok, select a 3 month period and you see exactly the same trend.

 

https://www.marketwatch.com/investing/index/dxy

 

Frankly, I don't know why 10 year treasuries were so low for so long, but clearly the underlying US economy appears to be gaining some serious momentum. Some indeed are cautioning that it is overheating.

 

I don't know.  I still see way too many shuttered factories and the US labor participation rate while improving is still very low. I think we have plenty of slack that this can continue for quite a while without any real fear of overheating.

[kaorop]

when 99.9% of this place is corrupt and somehow this area is not?

 

lol

 

quote all the gobblydee goop finance lies you like, ill stick with ocam.