Thai central bank sees no 'material impact' from inclusion on U.S. watch list

 

FILE PHOTO: Thailand's central bank is seen at the Bank of Thailand in Bangkok, Thailand April 26, 2016. REUTERS/Jorge Silva

 

BANGKOK (Reuters) -Thailand's central bank said on Thursday it did not see a big impact on foreign trade and investment by being put on a U.S. currency watch list, nor should it impede its ability to conduct macroeconomic policies to safeguard domestic stability.

 

The comment came after Washington put Thailand on its watch list of countries suspected of taking measures to weaken their currencies against the dollar.

 

The Bank of Thailand said it had conducted two-way intervention only to ride out baht volatility and had no intention to do use the exchange rate to gain an unfair trade advantage and competitiveness over trading partners, Assistant Governor Chantavarn Sucharitakul said in a statement.

 

"At this stage, the assessment is not expected to have a material impact on Thailand’s international trade, as well as the prospect for foreign direct investment into Thailand. Similarly, such assessment does not impede the ability of the BOT to fulfill its mandate on macroeconomic policies to safeguard domestic stability," she said.

 

The BOT has been in close dialogue with the U.S. administration to foster an understanding of Thailand’s macroeconomic and financial conditions, and had also reiterated its commitment to exchange rate flexibility, she said.

 

The baht rose 0.6% to 29.82 per U.S. dollar, breaching the psychological 30 level and at the strongest since May 2013.

 

Finance Minister Arkhom Termpittayapaisith also told reporters the inclusion was "not a worry at the moment".

 

"It's still a monitoring list and we don't know what actions they might take. In handling the baht, it should not have any impact as the central bank is taking care of it," he said.

 

(Reporting by Orathai Sriring and Kitiphong ThaichareonEditing by Ed Davies)

 

-- © Copyright Reuters 2020-12-17

 

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Ignorance is bliss.

I would fathom that the Real Estate community (Developers, agents, resellers) would beg to differ.

1 hour ago, webfact said:

The comment came after Washington put Thailand on its watch list of countries suspected of taking measures to weaken their currencies against the dollar.

 

1 hour ago, webfact said:

Finance Minister Arkhom Termpittayapaisith also told reporters the inclusion was "not a worry at the moment".

Oh brother, can you believe these folks.  It has been manipulated and still is being manipulated.  There is no reason for the baht to be so strong.  Someone is playing games and is about to get burned and take some major people with them when the Ponzi scheme they are playing with the capital inflows comes to an abrupt end.  But then Thailand is the center of the Universe and it is nothing to worry about, just a slight irritation much like a hemerrhoid. 

 

1 hour ago, webfact said:

It's still a monitoring list and we don't know what actions they might take. In handling the baht, it should not have any impact as the central bank is taking care of it," he said.

 

Just after the important people shift their money abroad and leave their 'important roles' in the coming years and the new people in charge discover the 'no money left in the kitty' letter will it eventually fall - drastically.

1 hour ago, webfact said:

The comment came after Washington put Thailand on its watch list of countries suspected of taking measures to WEAKEN their currencies against the dollar.

My caps.

They been on the watch list for years. So what? These arguments are in the same vein as investigating the Thai fishing industry for slavery. Just pissing in the wind. Put up or shut up with your impotent watch list. Who gives a rats?

I guess we should put the USA on that watchlist instead. After all, the US$ has kept weakening against almost all major currencies for several years now.

with the news that the US government was totally complicit in the needless deaths of hundreds of thousands during this pandemic they are hardly in the position of pointing their fingers at anyone..

7 minutes ago, Misterwhisper said:

I guess we should put the USA on that watchlist instead. After all, the US$ has kept weakening against almost all major currencies for several years now.

Wrong type of weakening unfortunately.  

 

Weak Currency Definition (investopedia.com)

A weak currency may help a country’s exports gain market share when its goods are less expensive compared to goods priced in stronger currencies. The increase in sales may boost economic growth and jobs while increasing profits for companies conducting business in foreign markets. For example, when purchasing American-made items becomes less expensive than buying from other countries, American exports tend to increase. In contrast, when the value of a dollar strengthens against other currencies, exporters face greater challenges selling American-made products overseas.

 

Currency strength or weakness can be self-correcting. Because more of a weak currency is needed when buying the same amount of goods priced in a stronger currency, inflation will climb as nations import goods from countries with stronger currencies. Eventually, the currency discount may spur more exports and improve the domestic economy provided that there are not systematic issues weakening the currency.

 

In contrast, low economic growth may result in deflation and become a bigger risk for some countries. When consumers begin expecting regular price declines, they may postpone spending, and businesses may delay investing. A self-perpetuating cycle of slowing economic activity begins and that will eventually impact the economic fundamentals supporting the stronger currency.

 

So, in essence, with the Baht increasing like it has it thus allows those upper crust folks to move money outbound and buy things cheaper and sell them higher here, they then repatriate the profits back into their accounts and the cycle repeats.   

Look at the Baht today.  Way up on USD to 29.83, the highest in maybe 7 years.  Now look at Chinese Yuan—up substantially on the Baht?  So what’s going on here?  Did China unload USTreasuries again?  Will Central Bankers shrug it off again?  Amazing Thailand.

Well I remember when they took Thailand off the watch list (think the baht was about 67baht to the £)  and then the currency started to fly. A crash back to 72baht or more to the pound would be nice for all including Thais except the rich.

It also makes no sense that the BOT is allowing banks to have a low interest and yield to be paid on savings and fixed deposit accounts.  Currently I see prices are slowly rising because of the cost associated with increased imports and the prices, which will lead to inflation as people try and buy what they can before the prices get to high, then you have the opposite occur where you have Deflation as the market becomes loaded with goods that people could not afford because of the inflating prices. However, with the minor stimulus measures being taken currently by the Government, they are just holding the wolf at bay, and just kicking the proverbial can down the road.  I hope they take this serious, but I doubt it as the rich are the only ones they cater to.

Edited December 17, 20205 yr by ThailandRyan

No good being on a list if your not number 1 ???????????????????????? Try harder ????

I only see a strengthening of the Thai Baht so what should the accusation of weakening the Thai Baht mean? The USA should make up her mind.

The reason for a weakening US$ is much closer to home than Thailand. 

The USA don’t know what they are talking about. Baht has not weakened over for US dollar it has strengthen so much that it hurts Thai export.

18 hours ago, condohope said:

I only see a strengthening of the Thai Baht so what should the accusation of weakening the Thai Baht mean? The USA should make up her mind.

If you’re going to express an opinion then you really should do a lot more than just look at an exchange rate from time to time, then you have less chance of seeming to be an idiot by getting things in reverse.

On 12/17/2020 at 1:27 PM, ThailandRyan said:

There is no reason for the baht to be so strong.

The national debt of Thailand is?

The national debt of the USA is?

The national debt of the UK is?

The national debt of China is?

hint 1&4 are positive 2 is badly negative and getting worse 3 is also negative.
So you can’t understand basic financial information?

 

Of course there are many other factors but if you are not in debt and have a good level of trade is it surprising that your currency is strong?

Edited December 18, 20205 yr by sometimewoodworker