What the weakening baht means for Thailand’s economy

[webfact]

 

By Thai PBS World’s Business Desk

 

The plunging value of the baht appears ominous and raises worrying questions about its impact on the Thai economy.

 

On Friday (July 15), the baht fell to 36.73 to the US dollar, its lowest in 15 years and eight months, according to Kasikorn Research Center.

 

Between July 11-15, foreign investors sold Thai shares worth 1.1 billion baht. Net buys have totalled 122 billion baht since early this year. They also sold Thai bonds resulting in net capital outflows of 2.1 billion baht from the Thai bond market since early this year.

 

Combined with the fast-rising inflation in Thailand and in many countries, a large number of consumers may feel the squeeze.

 

The weakening value of the baht has inflicted losses on some people while some have gained, said a senior director at the Bank of Thailand (BOT).

 

The manufacturing sector is complaining about rising production costs, as raw material and energy prices soar.

 

“We don’t hear complaints from other groups,” Daranee Saeju, senior director at BOT’s financial markets department, said without mentioning export groups.

 

Full story: https://www.thaipbsworld.com/what-the-weakening-baht-means-for-thailands-economy/

 

-- © Copyright Thai PBS 2022-07-19

 

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[Henryford]

The baht isn't weakening. The dollar is getting stronger, against all currencies.

[pokerface1]

4 minutes ago, Henryford said:

The baht isn't weakening. The dollar is getting stronger, against all currencies.

That’s closer to the truth it’s certainly stronger to the AUD. 

[JAFO]

Agree, The USD is the better performing currency at the moment.  I will say that I am sure enjoying the USD to baht conversion.  ????. 

[2baht]

What the weakening baht means for Thailand’s economy

 

Joy for expats and tourists!

[khunPer]

Euro is weak compared to the dollar, so baht is not weakening at all...????

[RichardColeman]

5 hours ago, webfact said:

The plunging value of the baht appears ominous and raises worrying questions about its impact on the Thai economy.

My lilly white bottom it is. £ was 44.01 yesterday , currently it's 43.8 ish. My books the £/baht is about 0.5% difference than previously - hardly an ominous fall

[Stocky]

Well the Singapore Dollar is doing fine, I got Bht26.18 yesterday, beginning of the year I was only getting Bht24.25.

[micmichd]

1 hour ago, RichardColeman said:

My lilly white bottom it is. £ was 44.01 yesterday , currently it's 43.8 ish. My books the £/baht is about 0.5% difference than previously - hardly an ominous fall

And compared to 10 years ago? 

[connda]

What the weakening baht means for Thailand’s economy

Happy foreigners. 

If TAT had a ounce of brains they would leverage the pro-foreign currency exchange rates as a selling point.
Then?  Drop all of the other silly Covid measures including mandatory testing, vaccinations, insurance, and such.
Leave the new tourism tax on place in order to cover one-off hospitalizations of Covid (or anything else).  It's a good idea.  It's significantly less expense for tourists with covering hospitalizing risk.  As far as I'm concerned, the mandatory insurance is a moneymaker for Friends Of the Thai Government.
Just levy the minimal tax on all tourist and it will offset any hospitalization expenses by tourists - without ripping tourists off for the benefit of the Thai insurance industry. 

These people are on the verge of a serious rebound in tourism if they don't "F" it up.  Legalized cannabis.  Liberalize alcohol lows for tourists.  Ditch the involuntary masks.  Get real and allow tourists to assume the risk they wish to assume. 
But - Personally I'd levy a hospitalization tax between 500 to 1000 THB per person.  It's peanuts but will cover most tourists for uneventful accidents and contracting the flu.  Thailand totally screwed up by throwing tourist into the Covid Prisons.  That was stupid, but their friends in Private Hospitals loved it. 
Cha-Ching!

 

Edited July 19, 2022 by connda

[Stocky]

1 hour ago, RichardColeman said:

My lilly white bottom it is. £ was 44.01 yesterday , currently it's 43.8 ish. My books the £/baht is about 0.5% difference than previously - hardly an ominous fall

That's because the UK economy is in an even bigger hole than Thailand - expect more pain for the GBPeso.  

[Cake Monster]

7 hours ago, webfact said:

The manufacturing sector is complaining about rising production costs, as raw material and energy prices soar.

And with the cost of a Unit of Electricity set to rise to 5 Baht / Unit in September from the present price of 4.6 Baht / Unit, inflation will rocket even further as costs at the Factory Gates will rise.

This will make all products more expensive, and raise the price of Exports

Stagflation is well and truly here

[Bangkok Barry]

41 minutes ago, Cake Monster said:

And with the cost of a Unit of Electricity set to rise to 5 Baht / Unit in September from the present price of 4.6 Baht / Unit, inflation will rocket even further as costs at the Factory Gates will rise.

This will make all products more expensive, and raise the price of Exports

Stagflation is well and truly here

I'm not sure that factories are on the same tariff. In fact, I doubt very much that they are. And I also don't know if their rate is also being increased. No doubt someone who does know will chip in soon....

[RichardColeman]

3 hours ago, micmichd said:

And compared to 10 years ago? 

I think if you are coming to thailand and worrying about the baht 10 years ago, you may have a few issues

[peterfranks]

4 hours ago, RichardColeman said:

My lilly white bottom it is. £ was 44.01 yesterday , currently it's 43.8 ish. My books the £/baht is about 0.5% difference than previously - hardly an ominous fall

Did you notice the article talks about the value against the US$, and doesn't mention that mickey mouse money they use in the UK?

[Chivas]

51 minutes ago, peterfranks said:

Did you notice the article talks about the value against the US$, and doesn't mention that mickey mouse money they use in the UK?

Whilst I wouldn't call my own countries money entirely mickey mouse you make the valid point that the article relates to the Baht against its only Benchmark..... the USD period

 

Flutuations that others may claim are quite simply their own countries currency weakness against the USD on the opposite side of the pairings

 

Only the USD has a direct exchange rate against every worldwide currency....for the rest of us its a two pairings number crunch to get the bottom line something at least half of this forum simply cannot grasp lol

[Dustdevil]

You've shown class by not getting defensive and upset and instead analyzing.

[micmichd]

12 hours ago, RichardColeman said:

I think if you are coming to thailand and worrying about the baht 10 years ago, you may have a few issues

If you are not able to compare conversion rate history, you don't know what you're talking about. 

[Cake Monster]

23 hours ago, Bangkok Barry said:

I'm not sure that factories are on the same tariff. In fact, I doubt very much that they are. And I also don't know if their rate is also being increased. No doubt someone who does know will chip in soon....

I am not sure which rates they will be paying for their Electricity either.

But for sure the rate thy are paying will also increase.

And dont forget, this increase will apply to all Commercial premises, including Hotels Etc Etc