Thai central bank still worried about speculation in baht

[lapamita]

wrong advise:

 

OLD RULE: Do not intervene in Currency markets

 

>> all intervention of centralbanks in the past , in any country,at any time in the past, would end up in big losses in the medium / longterm. They can only stable in the shortterm wih price of bigger risk LT.

 

dont belive? hstorie: Turkey 2018,Swiss 2017,Russis 2016,Brazil/argentina 2014 and the bigger ones: asiancrisis 98 ECU crisis 1993 GDp .Lira and Pesesta was leabing after the ECU currency system in 1993)

 

Personally i would like a intervention . bcs sitting on big looses EUR/THB long  since 35.30 

 

But Interventions are wrong

[zaZa9]

35 minutes ago, MartinKal said:

Ive looked up the figures. Thailand is doing well, but of course that are problems.

The country has 218 billion dollars of foreign reserves. Growth last year was 4.2%. Inflation is very low too low 0.9%. Unemployment is below 3%. There is a balance of payments excedent of 6.4%.

 

The troubles in the economy come from lower exports due to these trade disputes and poor receipts from tourism due to the strong baht. (Of course there is much more to it than this, and the government can do a great deal to modulate things under its control, but to just characterise and headline.)

 

If Thailand is selling less abroad, could it sell more at home? Could it invest more? Yes it could.

 

It could let more go from its tax expectations ( because if people spend  it's a good thing and if they repay their debts which is a problem in the private sector that is even better!)

 

It could spend some of its reserves, or do some monetary easing as printing money is called, on improving, even rebuilding, the infrastructure. Take care with PPP public-private Partnerships, as they can be real scams. And the experience in the west of QE is a really big red warning flag.

 

Consider transport. Not inter city or the line from China to the west; but just City level transport, especially in the TAT's top 12 tourist towns. Tramways. And this could tick the ecology box as pollution is a really big problem and a big negative for tourism.

 

As well as ecology, social reform is another box that needs ticking. Fundamental Improvement in the education system.  Thailand 4.0. More investment and opportunity in technology - MICE.

 

The north-south Divide is a real potential vote loser and even potentially cause of civil unrest. Inequality is not tolerated these days. While migrant flows from neighboring countries into the richer economy of Thailand are not wanted, inclusiveness is an issue.

 

 

"Vote loser" ??

Are we talking about Thailand ?

 

Unemployment at 3% ?

What  Thai villiage only has 3 people out of every 100 without a paying job? 

Or is 'subsistance' farming and card playing deemed  a "job" here  ?

 

Honestly , I have no idea how anyone can make future predictions for Thailand based on Thai statistics !

The numbers are all made up for gods sake...

[ahjames]

15 hours ago, BestB said:

It is not possible just to take down any currency , it’s called currency manipulation which is a punishable offence.

 

 

Tell that to china 555

[Millcx]

15 hours ago, BestB said:

Bank of Thailand should stop worrying and thinking. With Big P now in charge of economy it will be fixed in no time. 

 

Once riot dispersal vehicles are delivered there will be even less to worry about 

2 weeks I heard and it will be sorted “;0)

[kevin612]

Everyone wants the baht to stop 

[miamiman123]

Cui Bono? 

[Speedhump]

Wait, wait. The central bank is worried about speculation, they have the tools to handle it, but will let the Baht still follow market forces. Ah, thanks for clearing that up for me and the rice farmers. 

[Fex Bluse]

1 hour ago, MartinKal said:

Ive looked up the figures. Thailand is doing well, but of course that are problems.

The country has 218 billion dollars of foreign reserves. Growth last year was 4.2%. Inflation is very low too low 0.9%. Unemployment is below 3%. There is a balance of payments excedent of 6.4%.

 

The troubles in the economy come from lower exports due to these trade disputes and poor receipts from tourism due to the strong baht. (Of course there is much more to it than this, and the government can do a great deal to modulate things under its control, but to just characterise and headline.)

 

If Thailand is selling less abroad, could it sell more at home? Could it invest more? Yes it could.

 

It could let more go from its tax expectations ( because if people spend  it's a good thing and if they repay their debts which is a problem in the private sector that is even better!)

 

It could spend some of its reserves, or do some monetary easing as printing money is called, on improving, even rebuilding, the infrastructure. Take care with PPP public-private Partnerships, as they can be real scams. And the experience in the west of QE is a really big red warning flag.

 

Consider transport. Not inter city or the line from China to the west; but just City level transport, especially in the TAT's top 12 tourist towns. Tramways. And this could tick the ecology box as pollution is a really big problem and a big negative for tourism.

 

As well as ecology, social reform is another box that needs ticking. Fundamental Improvement in the education system.  Thailand 4.0. More investment and opportunity in technology - MICE.

 

The north-south Divide is a real potential vote loser and even potentially cause of civil unrest. Inequality is not tolerated these days. While migrant flows from neighboring countries into the richer economy of Thailand are not wanted, inclusiveness is an issue.

 

 

I'm not sure what would convince you that Thailand is doing "well".

The country has INCREDIBLY WORRYING economic and structural challenges ahead with no easy solutions.

https://www.bloomberg.com/graphics/2019-thailand-baby-bust/

[Guderian]

Thailand's economy is in the crapper, car sales lousy, factories closing down, and its biggest earner, tourism, in the doldrums. Yet the Thai Baht sails from strength to strength - how come?

 

Only one country has the foreign reserves to manipulate a currency on this scale, and that's China. Cambodia is already a de facto Chinese colony, for the most part owned and run by Beijing. The Vietnamese are very wary of China for historical reasons and it will never get much of a look-in there. China tried to do the same thing in Burma (Myanmar) that it's managed to do in Cambodia but was rejected by the military in the end. What else does that leave it in SE Asia? Ah yes, the country with the largest Chinese diaspora in the world, largely owned and run by locals of Chinese descent, one that regards the fact that the Western powers never bothered colonising it in the 19th century as its defining characteristic. Yet it never mentions its successful colonisation by the Cantonese clans in the era before that. Unless the Thai government wakes up it will find Western (and here I include Japanese and Korean) companies and tourists driven away by the mighty Sino-Baht, and its only option will be to accept Chinese 'assistance' in the way of ever-more Chinese tourists and industry and infrastructure built by Chinese firms on Thai soil under usurious terms. Come on, Thailand, even the Africans have mostly twigged the Chinese game of invest-and-conquer and are refusing any more 'assistance'.

[Bert Jones]

Tourism seems to be booming...at least in Chiang Rai and Mai...lots of Farangs milling around both cities and clogging up my favourite fooddy places. Thailand is still a hell of a lot cheaper than London, where I lived for 16 years. I hope the baht gets stronger...might send some of the sexpats packing and deter sex tourists from coming!

[Dice Man]

16 hours ago, marcusarelus said:

They can't take down the baht.  Ask for something reasonable like don't leave the EU if you want money again.  

A Democratic vote was held and it was ordained that the UK leave the EU. What do you want to do about that? What is "reasonable " for you?

[ClaySmc]

1 hour ago, MartinKal said:

Yes. 30.77 yesterday to 30.73

You blink you miss it, transfer wise says it's at 30.855

[Tayaout]

1 hour ago, zaZa9 said:

"Vote loser" ??

Are we talking about Thailand ?

 

Unemployment at 3% ?

What  Thai villiage only has 3 people out of every 100 without a paying job? 

Or is 'subsistance' farming and card playing deemed  a "job" here  ?

 

Honestly , I have no idea how anyone can make future predictions for Thailand based on Thai statistics !

The numbers are all made up for gods sake...

Normally they stop counting unemployment after x years someone did not work. Even in the west they do that to make stats looks better. 

Edited August 1, 2019 by Tayaout

[Sonhia]

What a fickle nation Thai are.

 

The other day the report painted a very positive picture, but surprise surprise, attitudes have changed, much the same as most Thai mind set mentality.

[Sydebolle]

No worries, honestly. The tourism figure is exploding in two digits growth year after year and the export is booming to - according to some sources. I therefore assume there is a nasty bug in the hospitality industry which has already killed hundreds of restaurants all over the land and some hotels cannot pay their utility bills with the meagre occupancy of a few rooms in a big hotel. 

The export, likewise, seems to be bugged as freight rates are dropping; what a strike of luck in an ever-booming export market. 

Face the music as it is. The Baht is strong because many reasons; be it the endless condominium buying frenzy by the Chinese, export of merchandise affected by the China-US trade conflict which compensates for a drop domestically and very weak currency situation in Europe which has nothing to do with the Thai Baht. 

[hotchilli]

The UK has shot itself in the foot as far as it's GBP value.. 3 years of Brexit fiasco is causing the drop due to uncertainties..

Some say stay in the EU but that means keeping all the Euro red tape that comes with it, others say throw off the EU shackles & get your sovereignty back.

Trade with the rest of the world will never stop.

The democratic vote was to leave the EU, the ministers should remember they're there to deliver on the vote not their personal choice... democracy is democracy !

[Brunolem]

16 hours ago, BestB said:

It is not possible just to take down any currency , it’s called currency manipulation which is a punishable offence.

 

 

Manipulation is what almost all central banks are doing. 

 

Negative interest rates in Europe are not the result of free market forces, but of central banks policy. 

 

The Swiss National Bank, SNB, has been busy printing money like mad in order to keep the Franc at a predetermined level. 

 

This is manipulation in plain sight and nobody says anything because everybody does the same, one way or another. 

 

The Bank of Thailand is an exception, for now. 

 

Note that the Thai benchmark interest rate is at 1.75%, below the US rate... so the interest rate doesn't explain the baht appreciation against the dollar. 

 

It seems that the Bank of Thailand is not overly concerned with the actual level of the baht, otherwise it could simply follow the example of the SNB. 

 

Yet, as another member said, there are also local considerations. 

 

Super low interest rates would only encourage the already heavily indebted population to go even more into debt. 

[sotsira]

16 hours ago, marcusarelus said:

They can't take down the baht.  Ask for something reasonable like don't leave the EU if you want money again.  

Is that because the EU economy is doing so well?

Or because the Euro currency is going from strength to 

strength?

[Brunolem]

15 minutes ago, Tayaout said:

Normally they stop counting unemployment after x years someone did not work. Even in the west they do that to make stats looks better. 

In the US they stop counting after one month, not year, which is why they can show an unemployment rate below 4%...while forgetting the 93 million working age persons which are considered as "out of the workforce" ... it's not only Thailand which is good at massaging stats... 

[BestB]

16 minutes ago, Brunolem said:

Manipulation is what almost all central banks are doing. 

 

Negative interest rates in Europe are not the result of free market forces, but of central banks policy. 

 

The Swiss National Bank, SNB, has been busy printing money like mad in order to keep the Franc at a predetermined level. 

 

This is manipulation in plain sight and nobody says anything because everybody does the same, one way or another. 

 

The Bank of Thailand is an exception, for now. 

 

Note that the Thai benchmark interest rate is at 1.75%, below the US rate... so the interest rate doesn't explain the baht appreciation against the dollar. 

 

It seems that the Bank of Thailand is not overly concerned with the actual level of the baht, otherwise it could simply follow the example of the SNB. 

 

Yet, as another member said, there are also local considerations. 

 

Super low interest rates would only encourage the already heavily indebted population to go even more into debt. 

You are talking about tools which influence currency I was referring to just devaluing currency without using any tools.

[Jiggo]

17 hours ago, BestB said:

It is not possible just to take down any currency , it’s called currency manipulation which is a punishable offence.

 

 

Harold Wilson got away with it......????

[orchidfan]

Slightly off topic but the photo of newly printed (2018) baht notes leads me to wonder why this is the only national currency that I know of that does NOT print the note denomination at the TOP of the note??

Why is that?

And the new colour of the B100 is now so close to the B500 note that twice I've been handed a new B100 instead of a B500 and vice versa!

Hard to tell in the back if a dark taxi or bar.

Green 20's, ok blue 50's ok but the rest are nonsense.

Whose design brainwave was this?

[Misab]

17 hours ago, marcusarelus said:

Do you really think that Thailand can effect UK or USA monetary policy?  From the article above, 

 

"The country’s central bank could give in to pressure and cut rates to curb the rising baht, economists said. Still, they were not optimistic about the effectiveness of such a move.

“The (Bank of Thailand) could consider a rate cut to help reduce the baht’s yield appeal, but it will be no panacea,” DBS analysts said in their note, adding that a cut of 25 basis points would just undo a hike by the central bank last December.

ING’s Sakpal similarly said that any cut would see limited results."

 

The Central bank can't really do anything legal to reduce the value of the baht.  It's not a Thai problem it is a UK problem.  

The Central bank can't really do anything legal to reduce the value of the baht.  It's not a Thai problem it is a UK problem.  ???

Not all Farangs in Thailand are from the UK. The strong Baht hits all countries and is a problem for Thai export and for turisme. Also for expats living here. It must be a problem for the local shops too, and for restaurants because when money become low and you have to save on your spending you make your own food at home.

 

[RichardColeman]

19 hours ago, webfact said:

as the Thai currency has stayed strong despite recent measures to slow fund inflows from abroad.

Contrary to asking for 800,000 from every expat !

[Krataiboy]

Thailand's central bank is still worried about speculation in the baht <THB=TH> and has tools to handle it

 

Are you listening, Mr Soros?

[KKr]

18 hours ago, BestB said:

called currency manipulation which is a punishable offence.

in what jurisdiction ?

[marcusarelus]

3 hours ago, Isaan sailor said:

We shall see, Marcus, what happens to tourists bookings for the coming high season.  I think you will see a nosedive come November (provided we have same Baht exchange rate).

38 million arrived last year.  How many do you predict in 2019 that would be a nosedive?  Because there is no reason for the pound or the dollar to change (nothing to do with the baht)

[Wake Up]

4 hours ago, helloagain said:

I want the arse to fall out of it

One sure way to make the baht weak is if the Thai people could vote for Brexit revealing their arrogance and anti immigration attitude. Then the baht would fall.  

 

Wait the UK already did that. ????

[Stevemercer]

The Thai economy is fundamentally weak, and will be the worst performing of all South East Asian countries this year. Yet the Baht is by far the best performing currency. Why? If the Central Bank is to be believed it is the inflow of hot money attracted by Thailand's relatively higher interest rates.

 

As argued in today's press, the Thai economy is much weaker than the 'official' figures would have you believe. 

 

On an adjusted true GDP basis, GDP growth for the first quarter 2019 is 0.3%, not 2.8% as published by the government. Using adjusted GDP, the Thai economy has been in a steep decline since the third quarter of last year.

 

The main cause is the negative growth in exports of goods and services. Such exports are 77% of Thai GDP. Thus a 5% drop in exports will mathematically translate into a 3.8% contraction of the economy. In the first quarter, export growth was -4.9%, but GDP growth was stated as +2.8%. The real figure is 0.3%.

[khunPer]

Thailand raised its interest rate in December 2018, and the baht have gone up since then. USA has just lowered their interest rate by 0.25 point – first time lowered since the 2008 financial crisis – will that perhaps make the baht increase its value even further..?