Thai central bank still worried about speculation in baht

[cerox]

I am working on my exit plan. I watched the EUR steadily decline against the THB from 45 to now 33 since yesterday or so. Esp. from 36 down to 33 was very fast and almost terrifying.

I read many people here writing it is so expensive in their home country. For me, I can live better in Europe on 2.000 EUR than 60k THB here. At the current pace, it seems we are getting to 30 THB soon. I am not willing to pay more in a developing country than in the first world.

[Brunolem]

3 hours ago, BestB said:

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

Without using any tools... you mean using something like jawboning? 

 

Jawboning has been also widely used, notably by Mr Whatever it Takes Draghi... with some success, if one can call the collapse of the euro a success... 

 

In his time, prime minister Thaksin also used jawboning, to push the baht... up, when he said that the target exchange rate against the dollar should be a number starting with a 3...

 

He meant 39 since at that time the dollar was slightly above 40 baht. 

 

Since then, the baht hasn't needed any jawboning to climb all the way to 30 against the dollar... 

 

 

[Pdavies99]

20 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.  

Don't you get it, the UK's problems are a side issue efecting just the UK, the Thai Baht however is strong against all world currencies which is caused by the UK currency, just bad luck for Sterling, two issues!

 

 

[Caine]

6 hours ago, DPKANKAN said:

No bigger tool worth the praise!! 5555????????????????

Thai men and big tools should not be mentioned in the same sentence ask any bar girl. Tiddlers and Thai men is acceptable in any sentence. 

[justin case]

a low home currency VS a high baht, is that not the ideal moment to withdraw all your thai baht, convert to your home currency and head back home ? but off course, there are the limits you can bring back, specially if it is bank interests or investments ... right... you can only bring back of what you had "imported" 10,20,30,40 years ago

[thaimacky]

6 hours ago, Isaan sailor said:

6 hours ago, marcusarelus said:

In the past year tourism is up so tourists are not going somewhere else and money for any infrastructure improvements will be taken out a a current operating fund and not bank reserves.  

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).

 

Friends of mine who come to Thailand once or twice every year just decided to skip Thailand in November for the first time in more than 10 years and go to Cambodia instead. I guess they won't be the only ones...

[metisdead]

An inflammatory post has been removed. 

[Isaan sailor]

6 hours ago, cerox said:

I am working on my exit plan. I watched the EUR steadily decline against the THB from 45 to now 33 since yesterday or so. Esp. from 36 down to 33 was very fast and almost terrifying.

I read many people here writing it is so expensive in their home country. For me, I can live better in Europe on 2.000 EUR than 60k THB here. At the current pace, it seems we are getting to 30 THB soon. I am not willing to pay more in a developing country than in the first world.

Misery loves company.  USD remains depressingly low—although it has climbed 1% in the last 2 weeks.  Still, we down enough that you can find parts in mid-America, where retired Americans can live for less than it costs here.  And we have Medicare in US.  It does not cover us here. So let’s hope selfish Bank of Thailand comes clean, and stops the hot money nonsense.

[Stevemercer]

I note that the Government’s budget for 2020 is 3.22-trillion with a 489-billion-baht deficit. So the deficit (presumably borrowed) amounts to 15% of the budget.

 

According to the Minister, the budget will commence January 2020 and Government operating costs (salaries etc) for the period now until January will come out of the 2019 budget, more specifically from the investment budgets of state enterprises, public-private joint venture projects and the Thailand Future Fund.

 

In other words, day to day operating costs will be paid out of future investment/infrastructure funds meaning less and less for future capital projects which will need to be increasingly funded through deficit budgeting (or borrowing from China in real speak).

 

So, the Thai budget situation is not getting better, but still the Baht gets stronger!

[marcusarelus]

23 minutes ago, Stevemercer said:

I note that the Government’s budget for 2020 is 3.22-trillion with a 489-billion-baht deficit. So the deficit (presumably borrowed) amounts to 15% of the budget.

 

According to the Minister, the budget will commence January 2020 and Government operating costs (salaries etc) for the period now until January will come out of the 2019 budget, more specifically from the investment budgets of state enterprises, public-private joint venture projects and the Thailand Future Fund.

 

In other words, day to day operating costs will be paid out of future investment/infrastructure funds meaning less and less for future capital projects which will need to be increasingly funded through deficit budgeting (or borrowing from China in real speak).

 

So, the Thai budget situation is not getting better, but still the Baht gets stronger!

I notice the budget deficit is 2.5% for 2018 the same as last year and I also post a link

https://tradingeconomics.com/thailand/government-budget

https://tradingeconomics.com/thailand/government-budget

With such a large trade surplus and foreign exchange reserve (larger than the USA) why would they borrow from China.

 

Thailand Foreign Exchange Reserves. Thailand's Foreign Exchange Reserves was measured at 206.6 USD bn in Jun 2019, compared with 201.3 USD bn in the previous month.

 

[BestB]

9 hours ago, Brunolem said:

Without using any tools... you mean using something like jawboning? 

 

Jawboning has been also widely used, notably by Mr Whatever it Takes Draghi... with some success, if one can call the collapse of the euro a success... 

 

In his time, prime minister Thaksin also used jawboning, to push the baht... up, when he said that the target exchange rate against the dollar should be a number starting with a 3...

 

He meant 39 since at that time the dollar was slightly above 40 baht. 

 

Since then, the baht hasn't needed any jawboning to climb all the way to 30 against the dollar... 

 

 

No like , setting the rate artificially ie from tomorrow rate is this ie rate is set by BOT not the market 

 

 

[BestB]

14 hours ago, ahjames said:

Tell that to china 555

And look where China is now, trade war with US and suffering ????

[BestB]

12 hours ago, Jiggo said:

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

Flash news it’s 2019 not 1964

[Billy Bloggs]

Its up against all currencies not just the pound you dolts.

[BestB]

11 hours ago, Stevemercer said:

I note that the Government’s budget for 2020 is 3.22-trillion with a 489-billion-baht deficit. So the deficit (presumably borrowed) amounts to 15% of the budget.

 

According to the Minister, the budget will commence January 2020 and Government operating costs (salaries etc) for the period now until January will come out of the 2019 budget, more specifically from the investment budgets of state enterprises, public-private joint venture projects and the Thailand Future Fund.

 

In other words, day to day operating costs will be paid out of future investment/infrastructure funds meaning less and less for future capital projects which will need to be increasingly funded through deficit budgeting (or borrowing from China in real speak).

 

So, the Thai budget situation is not getting better, but still the Baht gets stronger!

It takes time to kick in, this would be first budget deficit in a very long time and keep in mind foreign reserves still remain highest in the world 

 

If Big P continues down the same path , I have a feeling by the end of his term baht would either crash or almost half in value 

[Jiggo]

10 hours ago, BestB said:

Flash news it’s 2019 not 1964

Well someone has never heard of Satire????

[BestB]

4 minutes ago, Jiggo said:

Well someone has never heard of Satire????

Is that another British PM from last century?

[Stevemercer]

Sure, Thailand has high foreign reserves.

 

According to the International Monetary Fund, foreign exchange reserves are defined as:

 

“Those external assets that are readily available to and controlled by monetary authorities for direct financing of payments imbalances, for indirectly regulating the magnitudes of imbalances through intervention in exchange markets to affect the currency exchange rate, and/or for other purposes”  

 

This is the main reason why the Baht is high and why Thailand is open to charges of currency manipulation. 

 

Of course, Thailand's foreign reserves were depleted in just 2 or 3 weeks during the 1997 monetary crisis. 

[BestB]

8 minutes ago, Stevemercer said:

Sure, Thailand has high foreign reserves.

 

According to the International Monetary Fund, foreign exchange reserves are defined as:

 

“Those external assets that are readily available to and controlled by monetary authorities for direct financing of payments imbalances, for indirectly regulating the magnitudes of imbalances through intervention in exchange markets to affect the currency exchange rate, and/or for other purposes”  

 

This is the main reason why the Baht is high and why Thailand is open to charges of currency manipulation. 

 

Of course, Thailand's foreign reserves were depleted in just 2 or 3 weeks during the 1997 monetary crisis. 

As I mentioned earlier with Big P give it a little time and he will burn through the reserves pretty fast, along with budget deficit should not take long 

[Brunolem]

20 minutes ago, BestB said:

As I mentioned earlier with Big P give it a little time and he will burn through the reserves pretty fast, along with budget deficit should not take long 

That is, if you assume that he is in charge of the economic policy, which he is not. 

 

As in many other places, big business is really in charge, and it seems that big Thai business is not much inclined to go on a public spending binge to satisfy the populace. 

 

After all, this was the reason why the previous leaders, brother and sister, were removed from power, and why the first decision of the actual leader was to put an end to the rice scheme. 

 

It seems unlikely that someone from the military would come up, all by himself, with such a priority... 

 

[Merida]

 

 

This is a quote from an IMF working paper (April 2019)

Quote:

In summary, 10 years after the GFC crisis, it is clear that the low zero lower bound on interest rates has proved to be a serious obstacle for monetary policy. However, the zero lower bound is not a law of nature; it is a policy choice. We show that with readily available tools, a central bank can enable deep negative rates whenever needed - thus maintaining the power of monetary policy in the future.   Unquote:

 

The general public has a 'head in the sand' approach to anything financial, it will be to their detriment if there is no reaction to what is proposed, by, not only the Australian government, but most western governments are working to this end, governments elected by you, and what they are proposing is in your name, most MP's are completely unaware of what they are voting for, they never read the legislation, they just vote along party lines, from accounts, they are tipsy when they enter the chamber to vote, and the general public to say that it doesn't affect them because they have no money anyway, and they never will, this is what Orwell predicted, total control of people, and their money.

 

Late on Friday, when most MP's are partying at the end of the week, the government slipped in a bill, that was passed by a teetotal quorum that was half asleep and ready to go home. on January 1st 2020, the bill will give the government the power to CHARGE depositors, 3-4-5% interest on their funds, whether they have the funds in a deposit account or cheque account it doesn't matter, and they can charge whatever they like, 10%, 15% depending on how desperate they are, and borrowers will be given 2-3-4-5% for borrowing, sounds far fetched doesn't it, remember this when it happens.

So, my theory is, that the black market money is being funnelled into countries such as Thailand, and a contributory reason why the Thai baht is so strong, just a theory, and, possibly a reason why the Australian dollar is weakening. Thailand, of course, doesn't use or accept credit or debit cards, you will see signs at the swankiest restaurants and hotels saying 'cash only', so it would be almost impossible to eliminate cash transactions, there would be a revolution.

[Merida]

I forgot to include this link  https://www.youtube.com/watch?v=770M2s6ZD8Y&feature=push-fr&attr_tag=NssePkVXX4ptIccK%3A6    

[Brunolem]

1 hour ago, Merida said:

 

 

This is a quote from an IMF working paper (April 2019)

Quote:

In summary, 10 years after the GFC crisis, it is clear that the low zero lower bound on interest rates has proved to be a serious obstacle for monetary policy. However, the zero lower bound is not a law of nature; it is a policy choice. We show that with readily available tools, a central bank can enable deep negative rates whenever needed - thus maintaining the power of monetary policy in the future.   Unquote:

 

The general public has a 'head in the sand' approach to anything financial, it will be to their detriment if there is no reaction to what is proposed, by, not only the Australian government, but most western governments are working to this end, governments elected by you, and what they are proposing is in your name, most MP's are completely unaware of what they are voting for, they never read the legislation, they just vote along party lines, from accounts, they are tipsy when they enter the chamber to vote, and the general public to say that it doesn't affect them because they have no money anyway, and they never will, this is what Orwell predicted, total control of people, and their money.

 

Late on Friday, when most MP's are partying at the end of the week, the government slipped in a bill, that was passed by a teetotal quorum that was half asleep and ready to go home. on January 1st 2020, the bill will give the government the power to CHARGE depositors, 3-4-5% interest on their funds, whether they have the funds in a deposit account or cheque account it doesn't matter, and they can charge whatever they like, 10%, 15% depending on how desperate they are, and borrowers will be given 2-3-4-5% for borrowing, sounds far fetched doesn't it, remember this when it happens.

So, my theory is, that the black market money is being funnelled into countries such as Thailand, and a contributory reason why the Thai baht is so strong, just a theory, and, possibly a reason why the Australian dollar is weakening. Thailand, of course, doesn't use or accept credit or debit cards, you will see signs at the swankiest restaurants and hotels saying 'cash only', so it would be almost impossible to eliminate cash transactions, there would be a revolution.

Many places accept debit or credit card in Thailand, but they also accept cash. 

 

Anyway, I can't imagine Thailand going cashless anytime soon. 

 

Meanwhile in the West, they will charge more and more those foolish enough to hold/save money. 

 

First, charging interests to depositors is a form of bail in, helping all these insolvent banks to go on. 

 

Then, they want the population to consume to death, not only to burn its cash, but to go into debt as deeply as possible. 

 

Sooner or later, the West will introduce official cryptocurrencies that will enable total control of the population's money. 

 

The Big Daddy state will authorize its citizens/children to access to whatever money it will see fit. 

[BestB]

4 hours ago, Brunolem said:

That is, if you assume that he is in charge of the economic policy, which he is not. 

 

As in many other places, big business is really in charge, and it seems that big Thai business is not much inclined to go on a public spending binge to satisfy the populace. 

 

After all, this was the reason why the previous leaders, brother and sister, were removed from power, and why the first decision of the actual leader was to put an end to the rice scheme. 

 

It seems unlikely that someone from the military would come up, all by himself, with such a priority... 

 

He is in charge , keep up with the latest developments ????

 

 

[Brunolem]

1 minute ago, BestB said:

He is in charge , keep up with the latest developments ????

 

 

Of course a frontman always has to look as if he was in charge, and those in the back are certainly not going to say otherwise... 

[Angry Dragon]

On 7/31/2019 at 4:20 PM, nkg said:

Well, Bank of Thailand .....

 

If you lower interest rates, the Thai baht will be less attractive to currency speculators, who will take their their money elsewhere. The baht will fall 5% or so. Everybody wins.

even those of us who work in Thailand and receive a salary in THB?

[Angry Dragon]

On 7/31/2019 at 5:54 PM, marcusarelus said:

No one has proposed a method of taking the baht down 5% in relation to the Pound or USD

the Thai central bank could add to its dollar reserves by buying USD in exchange for THB.  I hope they don't though.