Central bank panel ready to take more action to deal with rising baht

[fulhamster]

21 minutes ago, Isaan sailor said:

I’d still like to know why the Viet Dong remains stable—yet the Baht gyrates out of control every day...

Because they devalue 2 or 3 times a year

[newnative]

What a joke. Ready to take 'more action'when it hasn't done much at all.  And, doing nothing now but 'monitoring'.  So, no 'action' done and no 'action' in the works.  They are in the 'action' of twiddling their thumbs.  Nice work if you can get it.

[miamiman123]

Don’t beltrbey can control it...it’s USA China issue...and the Thai money is along for the ride 

[mberbae]

OF COURSE there IS currency manipulation. What happened over the 3 day NY holiday was

a good example. The strong baht has scores of tourists going to Vietnam and elsewhere.

You can't have it both ways.

[1FinickyOne]

57 minutes ago, Sticky Wicket said:

yeh all the imported goodies that haven't been reduced over the last few years with the strong baht would suddenly sky rocket!

quite possibly.. your imported wine and spirits might go up, but how many Thai would really care? And it is their country - 

[whitfield]

If they seriously want to weaken the baht they can simply remove the ridiculous import duties on products like wine and cars.  This would have an immediate effect on the current account and would enable Thais to benefit from their improving economy.

[Jimbo2014]

6 hours ago, webfact said:

the global economic outlook has started to stabilise. As a result, Thai exports and economic growth will tend to improve in 2020,

What a goose! - the US stockmarket is hopelessly overvalued.  Its an election year.  China is swimming in black debt.  Most economists predict low growth this year at best and many fear a collapse of the US stockmarket.  This goose predicts a bumper crop!  The craziness never ends here.

[Elzear]

I don't know the Thai language, but I understand even less that financial gibberish from BOT. Seems like a lot of circumlocution to say zilch.. 

Ask the plastic-less citizen what he makes of it ? Knowing about the education level of the LOS population, that BOTman might as well talk to the mirror, full of his imbued importance. 

 

[SuperTed]

Anyone in this thread have a PhD in economics?

 

I asked the Chief Economist Asia for a large bank about the Baht again last week. She pretended not to be interested, but could not explain why the Baht was so strong. Nobody knows or can explain what is going on. 

 

Maybe we should start praying to the spirits in the trees for relief? Effective as anything else people are doing.

[TheFishman1]

Not Talk nothing happens TIT

[mickymouse1]

4 hours ago, ThailandRyan said:

Here is a real question for all you financial money folks.  What would the end result be if the government had to devalue the THB?  Currency manipulation is definitely happening somewhere along the lines.

I doubt that, but of course the Devaluation will lead to a higher exports and inflow of investment etc, " they hope".

[hotchilli]

7 hours ago, webfact said:

Central bank panel ready to take more action to deal with rising baht

Ready, talking, setting up committees, lots of watching, waiting, debating but as yet achieving nothing!

[BobbyL]

3 hours ago, Sticky Wicket said:

It makes Swiss hotels particularly cheap.

How wonderful

Fantastic ????

[whimsicalmike]

3 hours ago, legend49 said:

Yes ALL talk NO action.

Maybe they are trying to become members of No Action Talk Only NATO

[davidstipek]

4 hours ago, saengd said:

If the underlying cause of the problem is not resolved first, devaluation would only give everyone more Baht in exchange foreign currency. That would cause even more foreign currency to be introduced and cause the Baht to strengthen even further. Simply put, devaluation wouldn't work.

As you say...

But!

We would have more foreign currency being brought into the Market, Buyers would buy again and Exports here would rise, Shops would have more income.... Thai People would be enabled to buy what, They need and thus the Economy would drastically Improve!!

 

….and for facts for devaluation not working??  I remember when Baht was 40b to 1 USD... people were spending, Economy was on Solid Ground! Exports were Great! Worldwide Thailand was a Leader in Exporting of Goods, even in U.S. Department Store chains had their Personal Buyers here in Thailand! 

 

Who got Greedy here and Manipulating a Change??? Easy, Look which Bank Accounts, Corporation Profits have Increased the most in the last 20 years... This is why the Baht was driven to the level it is now, not by any Economy but by peoples Bank Books!

 

Two ways to improve profits here..

1. Raise Value of Baht and by doing so cut your Exports. Doing so will be amplified as of now. Quantity of orders becoming less and less. Baht is made on single sale / items.

2.lower value of Baht and by thus doing extend export season as Quantity of items sold. Increasing profits, bringing Tourist's back to spend money across the full spectrum of Stores and Shops. Improving everyone Income not just the Elite's!

 

[heybuz]

Would using some of the foreign reserves for infrastructure and social program's eventually drive the bht down. ? No expert just a question.

[alfalfa19]

The Minister of Asinine Pronouncements (MAP) has spoken.  They intend to escalate their strategy to reverse this trend of the rising baht:   They will do a whole lot more of nothing than they were doing before.  Bravo. 

[George Aylesham]

No way can this be termed 'currency manipulation' - simply prudent management of the national currency. And the USA does it just as much as any other countries.

[Ron jeremy]

3 hours ago, Isaan sailor said:

I’d still like to know why the Viet Dong remains stable—yet the Baht gyrates out of control every day...

Canuck buck took a jump from 17k to almost18k since my last trip.

returning to Vietnam again. Love it there, much better value, my money is worthless in Thailand. Gotta go where I get more bang for my buck. I work long and hard for a holiday.

[30la]

8 hours ago, webfact said:

However, the global economic outlook has started to stabilise. As a result, Thai exports and economic growth will tend to improve in 2020, he said.

It seems that speculation is over!
I really wish you economy growth in 2020, but be realistic and keep expectations low!

[brokenbone]

4 hours ago, saengd said:

What action would you take?

give all expats on retirement visa extension an allowance of say, 5 million baht,

or at least give me

[Sticky Wicket]

1 hour ago, heybuz said:

Would using some of the foreign reserves for infrastructure and social program's eventually drive the bht down. ? No expert just a question.

It has been talked about by some members of the BOT but they were shot down. 

Surprised they haven't set up a Sovereign wealth fund by now

By law, foreign reserves are needed to back up the Thai currency.The central bank also uses the reserves to manage the baht's foreign exchange rate.

 

[Sticky Wicket]

1 hour ago, brokenbone said:

give all expats on retirement visa extension an allowance of say, 5 million baht,

or at least give me

A Thai wouldn't give a foreigner the steam off their pìss

[overherebc]

4 hours ago, Sticky Wicket said:

yeh all the imported goodies that haven't been reduced over the last few years with the strong baht would suddenly sky rocket!

Ah, you're working on the Nana plaza model. Punter gets more baht per dollar, say 40 instead of 30, so price of ST(D) goes up because you are richer. Punter gets 25 baht per dollar, instead of 30, so price of ST(D) goes up because, well because, hold on, give me a minute, got it, because it should.

PS 

I know nothing about international money matters and don't comment because it really bores me to death.

Ah 1pm, 3 hours until my cold beer.

[Sticky Wicket]

1 minute ago, overherebc said:

Ah, you're working on the Nana plaza model. Punter gets more baht per dollar, say 40 instead of 30, so price of ST(D) goes up because you are richer. Punter gets 25 baht per dollar, instead of 30, so price of ST(D) goes up because, well because, hold on, give me a minute, got it, because it should.

PS 

I know nothing about international money matters and don't comment because it really bores me to death.

Ah 1pm, 3 hours until my cold beer.

I was just thinking about all the imported stuff I buy . None of it has gone down in price even though the baht has been super strong for years!

[saengd]

4 hours ago, Sticky Wicket said:

yeh but you said it had been debunked.

Moves to counter doesn't mean it has stopped either

Foreign currency enters Thailand and gets exchanged for Baht for a number of reasons:

- payment of Thai export bills

- Foreign Direct Investment

- Tourism

- Hot money, aka short term funds looking for an investment home

Only USD that is traded against THB causes the Baht to change in value, when USD is sold for Baht the Baht increases in value and vica versa. There is no impact when other currencies are exchanged for THB, this is because BOT tracks USD for its managed peg.

 

All the above foreign currency is either repurchased and exported by tourists, stashed in foreign currency accounts or ends up in the BOT Foreign Currency Reserves, mostly the latter.

 

The Foreign currency reserves have increased by about USD 12 bill. in the past year, about USD 1 bill. per month on average, see link below.

 

The trade surplus for the past year has amounted to around USD 12 bill. also hence all the inbound foreign currency is accounted for.

 

https://www.bot.or.th/App/BTWS_STAT/statistics/BOTWEBSTAT.aspx?reportID=80&language=ENG

https://tradingeconomics.com/thailand/balance-of-trade

 

 

 

 

[saengd]

23 minutes ago, Sticky Wicket said:

It has been talked about by some members of the BOT but they were shot down. 

Surprised they haven't set up a Sovereign wealth fund by now

By law, foreign reserves are needed to back up the Thai currency.The central bank also uses the reserves to manage the baht's foreign exchange rate.

 

Not really. The purpose of Foreign Currency Reserves is to provide assurance to trading partners that the country can pay it's import bills, there is no legal requirement to do this.

[saengd]

2 hours ago, heybuz said:

Would using some of the foreign reserves for infrastructure and social program's eventually drive the bht down. ? No expert just a question.

Government expenditure does help but not using the Foreign Currency Reserves, they are for a specific purpose hence the name "reserves".

[Sticky Wicket]

4 minutes ago, saengd said:

Not really. The purpose of Foreign Currency Reserves is to provide assurance to trading partners that the country can pay it's import bills, there is no legal requirement to do this.

It's actual law

[saengd]

4 hours ago, mberbae said:

OF COURSE there IS currency manipulation. What happened over the 3 day NY holiday was

a good example. The strong baht has scores of tourists going to Vietnam and elsewhere.

You can't have it both ways.

The Vietnamese Dong is quite weak at present, it represents excellent value for Thai's and Chinese people but the Vietnamese economy is nothing like Thailand's. Vietnam is the new boy on the block, their currency is linked to USD via  crawling peg which means it is more closely aligned to USD than is THB. Vietnam also doesn't have the same foreign currency reserves nor exports and tourism profile that Thailand does,