Oz $ losing so much value to the Baht

[scorecard]

What's happening? What's the forecast for the near future?

[steven100]

because the AUD is now 67.45 cents to the USD .... hence the reason for the drop to the Baht. 

 

but it may start to recover some after tomorrow when the US cut .25 basis points off the interest rate. 

 

 

Now 21.78  to the THB ......    very bad price.   

 

 

 

 

Edited September 17 by steven100

[Lacessit]

17 minutes ago, steven100 said:

because the AUD is now 67.45 cents to the USD .... hence the reason for the drop to the Baht. 

 

but it may start to recover some after tomorrow when the US cut .25 basis points off the interest rate. 

 

 

Now 21.78  to the THB ......    very bad price.   

 

 

 

 

What are you talking about? Cross rate on xe.com is 22.48.

 

The exchange rate seems to fluctuate between 22 and 24.

 

I pine for the days when it was 32. My 800K was exchanged at 29.

[steven100]

10 minutes ago, Lacessit said:

What are you talking about? Cross rate on xe.com is 22.48.

 

The exchange rate seems to fluctuate between 22 and 24.

 

I pine for the days when it was 32. My 800K was exchanged at 29.

The 21.78 is just from the Bangkok bank TT rate ....   but obviously the xe.com rate will be slightly better. 

[Mike Teavee]

51 minutes ago, steven100 said:

because the AUD is now 67.45 cents to the USD .... hence the reason for the drop to the Baht. 

 

but it may start to recover some after tomorrow when the US cut .25 basis points off the interest rate. 

 

 

Now 21.78  to the THB ......    very bad price.   

 

Seems to be even money on whether they cut by .50 basis points https://www.reuters.com/markets/rates-bonds/fed-seen-nearly-likely-cut-rates-by-50-bps-25-bps-2024-09-13/ 

... if they do, it will hit the USD but if they don't a 25 point drop is almost certainly priced in already. 

 

 

TT Exchange booths are offering 22.50 to 1AUD... https://ttexchange.com/

 

Edit: Whoops it just dropped to 22.05!

Edited September 17 by Mike Teavee

[KhunBENQ]

Most currencies lost significantly to THB (Baht strength).

Multiple threads disussing reasons.

AUD (OZ) may not be the biggest looser but 2.67% in a month is significant. What was the last pension rise in percent?

USD lost almost 4% in a month.

 

 

Edited September 17 by KhunBENQ

[norbra]

The AUD is currently suffering from China's over supply in steel,with steel makers cutting imports of iron ore drastically even dumping steel into Thailand.

Since China's cutback iron ore prices have dropped by $60 pt.

[KhunBENQ]

Is there light on the horizon? The graphs show a slight increase since the weekend.

[KhunBENQ]

1 minute ago, norbra said:

The AUD is currently suffering from China's over supply in steel,with steel makers cutting imports of iron ore drastically even dumping steel into Thailand.

Since China's cutback iron ore prices have dropped by $60 pt.

I appreciate your contribution but really: ALL major currencies have lost.

[norbra]

12 minutes ago, KhunBENQ said:

I appreciate your contribution but really: ALL major currencies have lost.

Many currencies ha ve cut their interest rates whilst AU have not so in this scenario AUD not in same basket 

[Pattaya57]

I think this has more to do with the ridiculously strong Baht than the A$.

 

Only 2-3 months ago we were at 24.50 baht and hopefully many people topped up their Thai accounts in July (I sent $9k @ 24.18, wish I sent more)

 

I can't see it changing much as RBA unlikely to cut interest rates next week. I'm going to wait until Thailand manipulates some strength out of their baht

 

Edited September 17 by Pattaya57

[KhunHeineken]

On 9/17/2024 at 2:08 AM, norbra said:

Many currencies ha ve cut their interest rates whilst AU have not so in this scenario AUD not in same basket 

The US took the position to raise interest rates big, and raise them quickly. Harsh, but short term pain.  This is why they are now in a position to lower their rate.

 

Australia couldn't do this, otherwise the Australian Ponzi housing market scheme would have collapsed. Australia had to raise rates smaller, and slower, so it was .25%, then .25%, then .25% etc.  The rates were behind the inflation curve. 

 

The RBA needed to give people time to refinance, get a second job, apply for a bigger credit card, sell a car etc etc, or risk foreclosures and homelessness of epic proportions across the country.    

 

Australia is still around 3.8% inflation.  It's above the 2% to 3% rate acceptable to the RBA. 

 

The RBA only has interest rates as a trigger to pull.  The government could have done many things to help reign inflation in when it was on the boil, but they were too spineless. 

 

Instead, they kept the sole responsibility with the RBA to use the blunt hammer of interest rates which does not spread the pain evenly across all Australians.  This also allowed them to shift blame.  

 

Weak governance when leadership was needed. 

[scorecard]

On 9/17/2024 at 12:27 PM, Pattaya57 said:

I think this has more to do with the ridiculously strong Baht than the A$.

 

Only 2-3 months ago we were at 24.50 baht and hopefully many people topped up their Thai accounts in July (I sent $9k @ 24.18, wish I sent more)

 

I can't see it changing much as RBA unlikely to cut interest rates next week. I'm going to wait until Thailand manipulates some strength out of their baht

 

Your last sentence. Is that likely to happen?

Is there any current push by industry (or any other sector) for that to happen?

[Pattaya57]

7 minutes ago, scorecard said:

Your last sentence. Is that likely to happen?

Is there any current push by industry (or any other sector) for that to happen?

Yes, Google "Thailand to lower interest rates" and you'll see the Finance Minister is meeting with the central bank to request lowering interest rates to then lower the value of the baht
 

[Isaan sailor]

Why does the Baht have an inverse pricing to most, if not all western currencies?   When the western currencies go down—why can’t the Baht go down along with them?

[KhunHeineken]

7 hours ago, Isaan sailor said:

Why does the Baht have an inverse pricing to most, if not all western currencies?   When the western currencies go down—why can’t the Baht go down along with them?

They restrict the trade of the baht to artificially inflate its value.  

[scorecard]

11 hours ago, Isaan sailor said:

Why does the Baht have an inverse pricing to most, if not all western currencies?   When the western currencies go down—why can’t the Baht go down along with them?

 Just read that the US Fed has just changed the rate by 50 basis points. How will that affect the Baht?

 

[chiang mai]

2 minutes ago, scorecard said:

 Just read that the US Fed has just changed the rate by 50 basis points. How will that affect the Baht?

 

THB will strengthen on the back of the US Fed rate cut but not against all currencies. USD connected currencies, those that are pegged to USD or which are hard or soft managed against USD, will gain, others may not. THB is soft managed against USD (Managed floating rate).

 

AUD is an odd one because AUD is a proxy for the Chinese economy and the YUAN.  China is Australia's biggest trading partner and since the Chinese economy is in the doldrums, Australia has not been exporting the volume of goods they expected. That has put downward pressure on AUD because there isn't really a fall back option, they have to wait for China to recover.  So AUD is more prone to move as a result of what happens in China than it is when things happen in the US.

[chiang mai]

15 hours ago, Isaan sailor said:

Why does the Baht have an inverse pricing to most, if not all western currencies?   When the western currencies go down—why can’t the Baht go down along with them?

 

15 hours ago, scorecard said:

Your last sentence. Is that likely to happen?

Is there any current push by industry (or any other sector) for that to happen?

 

A seriously helpful explainer from the Oz Central Bank explains the drivers for AUD value and everything related. Kudos to them for producing this. Note the part about reliance on commodity exports versus currency strength.

 

https://www.rba.gov.au/education/resources/explainers/drivers-of-the-aud-exchange-rate.html

[Isaan sailor]

4 hours ago, scorecard said:

 Just read that the US Fed has just changed the rate by 50 basis points. How will that affect the Baht?

 

It’s crazy.  US Fed cut interest rates 50 basis points—and US stocks relaxed, and the USD went up.  I give up trying to understand currency traders.

[chiang mai]

Just now, Isaan sailor said:

It’s crazy.  US Fed cut interest rates 50 basis points—and US stocks relaxed, and the USD went up.  I give up trying to understand currency traders.

Markets bought the rumour and sold the news, it does happen. But Asian markets will rise today and Western markets will not be far behind....it's a blip thing.

[steven100]

On 9/17/2024 at 7:03 AM, scorecard said:

What's happening? What's the forecast for the near future?

 

I think you will see the AUD recover some from here on in .....   it should look slightly better today,  and tomorrow ... then next week also. 

[Pattaya57]

Good news on the street this week at least. $A at TT Exchange

 

Mon - 21.95

Tue - 22.15

Wed - 22.22

Thu - 22.30

 

So that's a 1.6% increase in 4 days 😀

[chiang mai]

Asian well markets up, FTSE UK already up, the blip didn't last long. US open in under 3 hours, they will soar today I reckon.

 

https://www.investing.com/indices/major-indices

[Pattaya57]

13 minutes ago, chiang mai said:

Asian well markets up, FTSE UK already up, the blip didn't last long. US open in under 3 hours, they will soar today I reckon.

 

https://www.investing.com/indices/major-indices

So how does that affect the A$ to Baht exchange?

[scorecard]

2 minutes ago, Pattaya57 said:

So how does that affect the A$ to Baht exchange?

 

Good question, also keen to see a professional comment.

[chiang mai]

2 minutes ago, Pattaya57 said:

So how does that affect the A$ to Baht exchange?

 

 

https://www.rba.gov.au/education/resources/explainers/drivers-of-the-aud-exchange-rate.html

[chiang mai]

4 minutes ago, Pattaya57 said:

So how does that affect the A$ to Baht exchange?

As far as AUD/THB is concerned, the same issues exist today that existed yesterday, the only slight upside is global market momentum has increased. The old saying is, markets up, currency down, and vica versa. That means that when interest rates fall, investors move out of low risk assets, into higher risk equities and bonds. AUD is not really in that game since its only movement will result from market momentum, ie, the entire market moves.

[Pattaya57]

This is crazy, US drops interest rates, baht gets stronger. Australia keeps interest rates on hold, baht gets stronger vs A$ 😞

[chiang mai]

10 hours ago, Pattaya57 said:

This is crazy, US drops interest rates, baht gets stronger. Australia keeps interest rates on hold, baht gets stronger vs A$ 😞

An interesting piece below on the implications for Australia's economy as a result of Chinese policy changes. The bottom line is that exports to China have peaked and are in decline, this will manifest itself in the exchange rate, unless Australia can find new markets for its commodities, which seems improbable, given its remote location.

 

"For Australia, it does not take Albert Einstein to work out the implications. China is already using less coal, gas and iron ore. Even less is ahead.

Steel and iron have been falling for years already and they are not even halfway down yet. This affects the economy in three ways over time.

First, budget receipts are hit, spending is cut, or taxes rise. Second, falling prices force miners to curtail investment. Third, equity prices fall, which has begun but has far still to run.

 

These three impacts comprise a giant national income shock that wipes out wage growth and inflation. The Reserve Bank of Australia will be forced to cut the cash rate much deeper than anybody expects through the next few years".

 

https://au.finance.yahoo.com/news/chinas-interest-rate-move-leaves-australia-exposed-future-is-grim-200035137.html