Baht to further strengthen, expert warns

[webfact]

Baht to further strengthen, expert warns

By THE NATION

 

 

The baht could further strengthen to Bt29 per dollar, a Kasikornbank analyst warned this week.

 

In an economic climate deeply affected by the US-China trade war and a global slowdown, the baht is expected to strengthen further, reaching Bt30.50 to the US dollar by the end of the year, Kobsidthi Silpachai, head of capital markets research at Kasikornbank said

It could appreciate to between Bt29.20 and Bt29.30 by the end of next year, a 5-year high, he added.

 

This was due to a number of factors, the first being that the US-China trade war would continue to depress the global economy. The chance of global economy entering recession next year now stands at 26 per cent, and could lead to more capital flowing in to subscribe to Thai bonds.

 

The second factor is the high possibility that international rating agencies Moody’s Investors Service and Fitch Ratings will upgrade Thailand’s sovereign credit rating from triple B plus to A minus (BBB+ to A-) in the next 12 months. The market has priced in coming credit upgrades as the rate of credit default swap (CDS) of Thai debts has been below the rate charged for BBB+ rating for a while, he noted.

 

Third, Thailand’s high current account surplus, the combined result of tourism revenue, fall in imports and low domestic investment would continue to underpin the strong baht.

 

The surplus this year will reach $34 billion, he said. Thai economic growth is expected to expand by 3.5 per cent in the fourth quarter, while growth in the third quarter is estimated at 2.7 per cent.

 

The Thai economy is predicted to expand 2.8 per cent for the full year. “The government stimulus packages including the ‘Eat, Shop and Spend’ programme will boost the economy in the final quarter,” he predicted.

 

The US-China trade war and Brexit would largely determine the direction of the global economy. Uncertainty about the trade relationship and the Brexit deal has led many central banks to ease policy in order to shore up economies, but their actions would be a temporary solution and could not fully compensate for real economic reforms.

 

Investment in the Thai stock market will not see much activity in the fourth quarter as investors turn their attention to bonds due to slow economic growth, he said, pointing out, however, that investment in some stocks offered higher returns than bonds. Investors would therefore have to pick shares carefully.

 

The US Federal Reserve is expected to cut its policy rate again next week with two more cuts coming in 2020,” he added.

 

The Bank of Thailand’s monetary policy committee will lower its policy rate by 25 basis points to 1.25 per cent this year, he said.

 

Related Story: KBank eyes 4-6% growth in loans next year

Related Story: BOT plans measures to curb baht’s rapid appreciation

 

-- © Copyright The Nation Thailand 2019-10-25

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[Power of life yoga]

30 minutes ago, webfact said:

“The government stimulus packages including the ‘Eat, Shop and Spend’ programme

????

[keith101]

As the Thai baht gains more strength exports and tourism will fall even further and dropping the its rate by just 25 basis points will do nothing for the economy .

 

It seems destined for the Aussie dollar to drop below todays rate of 20.6 to into the 19s by next year making it impossible for me at least to continue living here and will probably lead to my divorcing my wife and returning to Aus forever , at least back home a dollar is worth a dollar and wont change .

Edited October 25, 2019 by keith101

[BigBadGeordie]

[Just1Voice]

My bill go up, buy my money to pay them goes down. ????

[PJPom]

The current Australian pension is approximately 37,900 baht, a reasonable sum to live on in Thailand but of course it doesn’t meet the Immigration requirement.

I think that we just have to sit it out and hope that the US and China get their act together and things improve.

It may be that the Aussie dollar is worth a dollar but how much will it buy, for me the only benefit of moving back would be health care and seeing that I believe I will just drop dead one day it isn’t a game changer.

To those of you seeing only a gloomy future don’t give up, always look on the bright side .

[Cadbury]

1 hour ago, webfact said:

It could appreciate to between Bt29.20 and Bt29.30 by the end of next year, a 5-year high, he added.

What about Bt28.5 by September next year as some are predicting. Should that happen it will make a huge dent in exports and put the country into an economic death dive.

What will Khun Prayut Chan-o-cha self appointed Chairman of the Economic Management Committee do then? 

[Sticky Wicket]

Oh joy of joys

Why don't they put those dollars to good use rather than hoarding them to manipulate the currency!

[SteveK]

7 minutes ago, Cadbury said:

What will Khun Prayut Chan-o-cha self appointed Chairman of the Economic Management Committee do then? 

Nothing. 

Edited October 25, 2019 by SteveK

[Creasy]

The Aussie $ will go further down against the THB when they cut the interest rates again in OZ

[Brer]

20 minutes ago, PJPom said:

The current Australian pension is approximately 37,900 baht, a reasonable sum to live on in Thailand but of course it doesn’t meet the Immigration requirement.

I don’t know how you can live on that figure, I guess you just eat lettuce, live alone and don’t go anywhere. 

You must be a lucky one to get that amount, the part pension they give me is substantially less.

I budget and review every month there is no way I could live on 38k baht with my wife and we don’t live a decadent life.

[Yinn]

16 minutes ago, Sticky Wicket said:

Oh joy of joys

Why don't they put those dollars to good use rather than hoarding them to manipulate the currency!

The surplus this year will reach $34 billion, he said. Thai economic growth is expected to expand by 3.5 per cent in the fourth quarter, while growth in the third quarter is estimated at 2.7 per cent.

 

The Thai economy is predicted to expand 2.8 per cent for the full year. 

 

The US-China trade war and Brexit would largely determine the direction of the global economy. Uncertainty about the trade relationship and the Brexit deal has led many central banks to ease policy in order to shore up economies

 

 

Thailand ok. If world slump, we will be ok.

 

 

[Nyezhov]

56 minutes ago, keith101 said:

probably lead to my divorcing my wife and returning to Aus forever

well take her with you, and if you cant afford to, you shouldnt have married her in the first place.

[keith101]

2 minutes ago, Nyezhov said:

well take her with you, and if you cant afford to, you shouldnt have married her in the first place.

Already taken her and hates it and we have been married for nearly 10 yrs and together for over 13 and did not expect the exchange rate to get so bad .

[marin]

1 hour ago, keith101 said:

It seems destined for the Aussie dollar to drop below todays rate of 20.6 to into the 19s by next year making it impossible for me at least to continue living here and will probably lead to my divorcing my wife and returning to Aus forever

Why would the Australian dollars fall cause you to divorce your wife. How are these two different problems connected?

[Nong Khai Man]

6 minutes ago, keith101 said:

Already taken her and hates it and we have been married for nearly 10 yrs and together for over 13 and did not expect the exchange rate to get so bad .

My Mrs " Loved " The U.K,But We just could NOT Afford to live there on my very REDUCED Pension......

[SteveK]

17 minutes ago, Yinn said:

The surplus this year will reach $34 billion, he said. Thai economic growth is expected to expand by 3.5 per cent in the fourth quarter, while growth in the third quarter is estimated at 2.7 per cent.

 

The Thai economy is predicted to expand 2.8 per cent for the full year. 

 

The US-China trade war and Brexit would largely determine the direction of the global economy. Uncertainty about the trade relationship and the Brexit deal has led many central banks to ease policy in order to shore up economies

 

 

Thailand ok. If world slump, we will be ok.

 

 

You of all people should know that any figures in Thailand are 100% fiction.

[Jip99]

Just now, SteveK said:

You of all people should know that any figures in Thailand are 100% fiction.

 

 

I won’t take your comment as 100% then.....

[holy cow cm]

37 minutes ago, Cork Soaker said:

 get real, that's only enough to survive on.

It’s enough to live fine on. BTW. Cork Soaker from SNL? Best skit ever. 

[Jip99]

16 minutes ago, keith101 said:

Already taken her and hates it and we have been married for nearly 10 yrs and together for over 13 and did not expect the exchange rate to get so bad .

 

 

Bad choice by your wife.......... she should have gone for Japanese.

[holy cow cm]

If the baht floats that strong it is certainly going to turn exports of certain commodities sour and value added non Thai products that can be produced in nearby countries like Vietnam to get the business. And the many expats that will have to leave will just be sad to their Thai loved ones. 

[stigar]

I choose to stay only 4-6 months a year in thailand.I have pension enough to have a good life there.Anyway i will stay 6-8 months a year in norway.Thailand is expencive for many to live in,even thais complain because everything gets more expencive.

[Nong Khai Man]

1 minute ago, stigar said:

I choose to stay only 4-6 months a year in thailand.I have pension enough to have a good life there.Anyway i will stay 6-8 months a year in norway.Thailand is expencive for many to live in,even thais complain because everything gets more expencive.

But I Thought Norway was SUPER Expensive....400 Baht for a PINT Of Beer ??

[SteveK]

Just now, Nong Khai Man said:

But I Thought Norway was SUPER Expensive....400 Baht for a PINT Of Beer ??

Same as some pubs on Sukhumvit.

[FarFlungFalang]

24 minutes ago, Yinn said:

 

 

 

Only 1600 baht per month. 50 baht per day. 

I am shock you divorce for that. 

Might have to do border run option no need to prove income or money in the bank.

[Nong Khai Man]

Just now, SteveK said:

Same as some pubs on Sukhumvit.

One Word then Steve...............AVOID !!

[baansgr]

38 minutes ago, Yinn said:

20.6 to 19. So 35,000 per month will be 1600 less.

And you will divorce? For 1,600 baht? 

True love? 

Maybe get a job/work permit?

Its not the 1,600...more like the 16,000 less than a few years ago

[Henryford]

53 minutes ago, keith101 said:

I DONT KNOW WHERE YOU GOT THAT FIGURE FROM  but my next payment due Monday will be around 35,200 well under what your saying and going down despite the bi-annual increases to the pension . The actual 28 day payment is $1,700.80 which the basic amount which all overseas pensioners get .

Think yourself lucky my UK pension (after 35 years of contributions) is under $AUS1000 for 28 days with NO inflation increases,

[FarFlungFalang]

31 minutes ago, Yinn said:

The surplus this year will reach $34 billion, he said. Thai economic growth is expected to expand by 3.5 per cent in the fourth quarter, while growth in the third quarter is estimated at 2.7 per cent.

 

The Thai economy is predicted to expand 2.8 per cent for the full year. 

 

The US-China trade war and Brexit would largely determine the direction of the global economy. Uncertainty about the trade relationship and the Brexit deal has led many central banks to ease policy in order to shore up economies

 

 

Thailand ok. If world slump, we will be ok.

 

 

If the world slumps Thailand empoyment will dive as will people's ability to repay the exceptionally high household debt and when the banks crash the foreign money will evaporate and Thailand may well find itself up deep sh!t creek without a paddle.

[marqus12]

I am sure that my country's currency would collapse by about 10-20%

in a similar situation as I observe here .

 

Strange baht .