Baht weakens against dollar after tough talk by central bank

[webfact]

Baht weakens against dollar after tough talk by central bank

By The Nation

 

 

The baht weakened against the US dollar last week and was traded cautiously later in the week after the Bank of Thailand expressed concern about its movement and was ready to announce more measures to stabilise the currency if necessary. 

 

Meanwhile, the US dollar gained on better-than-expected US retail sales in December and weekly jobless claims data. The baht was also weighed down by net foreign stock-selling orders. However, regional currencies rose along with the yuan after the US removed China from the list of currency manipulators and the first phase of the US-China trade deal was officially signed during the week.

 

On Friday (January 17), the baht closed at Bt30.37 to the US dollar, after having briefly hit a three-month low of 30.53/USD, versus Bt30.24/USD reported for Friday (January 10).

 

During the week of January 20-24, Kasikornbank expects the baht to move within a range of Bt30.20-Bt30.60/USD. A key domestic factor to be monitored closely is Thai export data for December. 

 

Meanwhile, the US economic data to be released during the week include December Existing Home Sales, and November House Price Index. Market participants will also await the outcomes of the Bank of Japan and European Central Bank meetings, signs of the next phase of the US-China trade negotiations, as well as preliminary composite purchase managers index data for January of the US, the euro-zone, and Japan.

 

Source: https://www.nationthailand.com/business/30380817

 

-- © Copyright The Nation Thailand 2020-01-20

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[falang07]

This is called a weakening? Just a normal intraday fluctuation, pathetic...

 

[trainman34014]

Tough Talk but no Tough Action !

[RichardColeman]

Ere, love, the dollar is worth an extra 0.13 baht per dollar. Let's go on that dream Thai holiday. 

[featography]

A waste of my time reading this. 

[hotchilli]

More nonsense.. reporting fluctuations not real movements.

[Helmet Grunter]

I love a strong baht, it get's rid of the weak ????

[Vascoda]

If not for the BoT, BAHT would be trading in lower 29 today. Glad that they are trying to keep it above 30 and stabilize it between 30-31. They have to be cautious and take measures based current account surplus, foreign currency reserve, and trade balance between the US. 

Edited January 21, 2020 by Vascoda

[sammieuk1]

Anyone keeping chickens will be happy with this corn????

[bronzedude]

Do these quotes represent "buying" or "selling" price? I check the on street exchange everyday, once in the morning and once in the evening and last week the "buying rate never went to 30.53. The bank rates were .20 to .30 lower. Why does Thai Visa bother to tell this to the public? It's an insignificant report. 

[Redline]

So the world got scared because of the Thai Central Bank?

[saengd]

1 hour ago, bronzedude said:

Do these quotes represent "buying" or "selling" price? I check the on street exchange everyday, once in the morning and once in the evening and last week the "buying rate never went to 30.53. The bank rates were .20 to .30 lower. Why does Thai Visa bother to tell this to the public? It's an insignificant report. 

It's the midpoint, to which is added or subtracted a margin by the buyer or seller.

[EricTh]

The Bank of Thailand has manipulated the Thai currency, or else it would have gone below 30 by now.

 

Not sure whether USA will label Thailand as 'currency manipulator' soon.

Edited January 21, 2020 by EricTh

[Mavideol]

up and down as some parts of our bodies do..... nothing to worry about BOT (same as TAT) has everything under control, minor currency fluctuations as not to alarm Prayut and his (rich) friends

[saengd]

32 minutes ago, EricTh said:

The Bank of Thailand has manipulated the Thai currency, or else it would have gone below 30 by now.

 

Not sure whether USA will label Thailand as 'currency manipulator' soon.

Below 30 would be 29, that would make it stronger!

 

But if you're intent on the manipulation theory, please explain to us how they manage to do it.

[Ireland32]

2 hours ago, bronzedude said:

Do these quotes represent "buying" or "selling" price? I check the on street exchange everyday, once in the morning and once in the evening and last week the "buying rate never went to 30.53. The bank rates were .20 to .30 lower. Why does Thai Visa bother to tell this to the public? It's an insignificant report. 

30,28 today at TT Currency in Pattaya

[Isaan sailor]

If you consider the Baht vs USD 10-year average at 32.40—today’s action is chicken feed.

Bank of Thailand is guilty of selling short term bonds (to whom remains a mystery), which brought the USD from 36 three years ago down to 30.17 today.  And it’s irrelevant that BoT has held off on bond sales.  Damage already done.

Before the China cheerleaders and Baht apologists hammer me—i’d just like to remind them that no other currency has behaved in this way vs USD.  

Go ahead and refute this, guys...

[EricTh]

I just read an article that claimed Bank of Thailand did manipulate the currency. It is dated 16 Jan and titled

Bank of Thailand lands in hot water

 

I am not allowed to link the Bangkok Post article as the forum bans linking.

Edited January 21, 2020 by EricTh

[chama]

12 hours ago, Helmet Grunter said:

I love a strong baht, it get's rid of the weak ????

Economic Darwinism...love it!

[mshs]

5 hours ago, chama said:

Economic Darwinism...love it!

Yes, from the Western World to the Third World.  From Thailand to Cambodia... 

[saengd]

6 hours ago, EricTh said:

I just read an article that claimed Bank of Thailand did manipulate the currency. It is dated 16 Jan and titled

Bank of Thailand lands in hot water

 

I am not allowed to link the Bangkok Post article as the forum bans linking.

Sure, they intervene all the time, by selling Baht and buying USD in order to weaken THB. But your earlier statement was regarding manipulation to keep the Baht artificially strong, that's simply not happening as the article you quoted confirms.

[saengd]

11 hours ago, Isaan sailor said:

If you consider the Baht vs USD 10-year average at 32.40—today’s action is chicken feed.

Bank of Thailand is guilty of selling short term bonds (to whom remains a mystery), which brought the USD from 36 three years ago down to 30.17 today.  And it’s irrelevant that BoT has held off on bond sales.  Damage already done.

Before the China cheerleaders and Baht apologists hammer me—i’d just like to remind them that no other currency has behaved in this way vs USD.  

Go ahead and refute this, guys...

Refuted!

 

All Thai bonds are denominated in THB, whoever buys them must use local currency to do so. If China were to buy them they would use their own currency, RMB, and doing so would have zero impact on the USD/THB exchange rate. If America was to buy those same bonds they would use USD and that would cause the Baht strengthen. But why would the US being buying Thai bonds when there is a currency risk to them plus there are so many better bond options available to them onshore USA?

 

Finally, when a bond sale is made the currency impact is immediate but within a few days its value will return to that determined by the markets, it's not as though the bond sale causes the currency to increase value and it remains there forever! For our bond theory to be valid BOT would need to be selling bonds to the US, every few days, all year long.......do you really think that's probable, especially given that BOT suspended bond sales for this very reason?

 

And finally finally! If your hypothesis is correct, where's the proceeds from the bond sales, can you point to where that inflow appears in the Foreign Currency Reserves!

[saengd]

Just reading the newspaper whose name cannot be mentioned....in it, Kasikorn is projecting Baht strengthening to 29.25 by end 2020, resulting from trade surplus and current account imbalance. Interesting that Kasikorn didn't say that Baht strengthening was the result of foreign bond buying or RMB transfers, but there again, why would they!!!

[Henryford]

21 hours ago, EricTh said:

The Bank of Thailand has manipulated the Thai currency, or else it would have gone below 30 by now.

 

Not sure whether USA will label Thailand as 'currency manipulator' soon.

So the Fed doesn't manipulate the Dollar by printing trillions of funny money !!

[saengd]

Here's the BOT bond sales results for 2020 thus far, it looks like about USD 15.5 billion (equivalent) in sales, the numbers for 2019 are at available on the same link. Imagine what sort of impact that would have on BOT foreign currency reserves if those bonds were paid for in USD!  https://www.bot.or.th/English/DebtSecurities/Auction/Result/Pages/default.aspx

[saengd]

2 minutes ago, Henryford said:

So the Fed doesn't manipulate the Dollar by printing trillions of funny money !!

The US Fed doesn't actually print money, this explains: https://www.thebalance.com/is-the-federal-reserve-printing-money-3305842

 

But Thailand doesn't even do those things, they certainly don't buy back their own Treasuries!

[EricTh]

3 hours ago, Henryford said:

So the Fed doesn't manipulate the Dollar by printing trillions of funny money !!

Don't you know that American Dollar has a special position in the world?

 

American Dollar would have crashed a long time if not for this special position.

 

USA threaten to put sanctions on any countries who manipulate their currencies except for American Dollar of course.

 

 

[saengd]

I reckon the combination of drought (and impact on the agricultural sector), the fallout from the US/China trade war, weakening global economics, an overly strong baht and now the Wuhan flu (and its likely impact on tourism), all mean that the Thai economy is facing headwinds. And now we've got the effects on the economy of a delayed budget as well. Analysts overwhelming forecast another cut in the BOT rate from an already record low, that in itself is telling. As always with these things it's rarely just one thing, more a combination of unique events. A year ago those things might all have been listed as possible downside risks that were unlikely to be realized, today they all have, what were the chances!

Edited January 23, 2020 by saengd

[Neeranam]

Thailand is spearheading cryptocurrency regulation in the world, which is wonderful. Corridors between her and Japan already allow instant cross border payments. SCB are leading the way.

 

I just booked a flight for 3 to Scotland for 60k baht return with BA, wonderful.

Previous trips have been well over 100k.

 

I hope the pound crashes more, for the idiocy of the UK government and peeps.

 

Hopefully on my next trip, Scotland will have freed herself of the lying, thieving English government.

[Neeranam]

On 1/22/2020 at 10:12 AM, saengd said:

The US Fed doesn't actually print money, this explains: https://www.thebalance.com/is-the-federal-reserve-printing-money-3305842

 

But Thailand doesn't even do those things, they certainly don't buy back their own Treasuries!

One country is highly corrupt, with past presidents continuing this ponzi scheme, just to get re-elected. At least the other country are moe pen about their corruption and the peeps rather like it.