Thai Baht Against The Gbp

[mommysboy]

What is that strange sound.

Oh thats the toilet flushing, taking the pound with it.

Talk about rose colored glasses or wishful thinking. We'll be lucky if there is a pound this time next year. I would say dropping to 40 would be a reprieve.

Why, eastern Europes banking problems with take down the UK also. swish-good bye cruel world.

That strange smell? Could be something else!

BS

Interest rates cut in the Uk to 0.5% today + a statement on quantative easing should send the £ further down the toilet

Both of these are already factored into the low £ already. Not exactly a surprise as both of these have been expected and talked about in detail for weeks.

Yes I agree. It's not just the UK preparing to use these techniques either.

Markets are so volatile that there is some chance that shorters may have one last fling, before moving on to the next target (which could easily be the Thai bt).

[Oberkommando]

I predict 80thb to the GBP by this time next year.

Let's come back to this post and see what happens.

[yabaaaa]

45 Baht per Pound as a short/medium term proposition seems quite likely to me.

Short term 2 baht per £ long term 99 baht per £

I could be wrong??

The problem with this is you haven't built in any margin for error!

Oh i think Ive pretty much got all bases covered there, lets see whose right in 12 months

[Merangue]

Pound Rises Against Euro on Speculation U.K. to End Rate Cuts

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By Matthew Brown

March 5 (Bloomberg) -- The U.K. pound climbed against the euro for a third day on speculation the Bank of England made the last of a series of cuts to its benchmark interest rate today, while the European Central Bank signaled further reductions.

Britain’s central bank lowered its key rate to 0.5 percent from 1 percent today, and said it will spend 75 billion pounds ($106 billion) buying government and corporate bonds in the next three months. European policy makers cut its main refinancing rate to 1.5 percent from 2 percent and ECB President Jean-Claude Trichet said the bank could lower the rate further.

“The foreign-exchange market has been factoring in the Bank of England making that final move to zero amid expectations of a sharp recovery for the pound,” said Neil Jones, head of European hedge-fund sales at Mizuho Corporate Bank Ltd. in London. “The currencies that are moving from higher yields to close to zero will suffer.”

The pound strengthened to 88.77 pence per euro by 4:15 a.m. in London, from 89.21 pence yesterday. Against the dollar, the British currency fell to $1.4113 from $1.4194.

Britain’s currency fell 27 percent against the dollar and 23 percent versus the euro last year as the economy faced its first recession since 1991.

The Bank of England reduced its benchmark rate to 0.5 percent, from 5 percent in October. The ECB cut its key rate to 1.5 percent, from 4.25 percent in the same period.

BOE ‘on Track’

“The Bank of England is on track, unlike the ECB, which is lagging,” Philip Tyson, head of interest-rate strategy at MF Global Securities Ltd. in London, said in a Bloomberg Television interview.

U.K. 10-year government bonds surged today as the Bank of England said it plans to buy medium- and longer-maturity gilts as well as the shorter-dated notes and corporate debt the bank had been anticipated to purchase.

The gains drove the yield on the 10-year gilt down by as much as 40 basis points or 0.4 percentage points, the most since at least 1992.

The 4.5 percent security due March 2019 rose 2.49, or 24.90 pounds per 1,000-pound face amount, to 109.84. The two-year yield fell four basis points to 1.19 percent, after earlier falling as much as 21 basis points.

The difference in yield, or spread, between two- and 10- year gilts narrowed 29 basis points to 209 basis points, after earlier widening to the most since at least 1992.

Quantitative Easing

The Bank of England has permission to buy up to 150 billion pounds of fixed-income securities, of which up to 50 billion can be corporate debt, according to a letter from the Treasury to the central bank.

The central bank will initially buy gilts with a minimum residual maturity of five years and a maximum maturity of 25 years, it said today. The U.K. Treasury will sell approximately 137 billion pounds of gilts in the fiscal year starting April 2009, according to Barclays Capital.

“They’ve specified they’ll be buying the long end, which was unexpected, and the long end has done very well off the back of it,” said John Wraith, head of sterling interest-rate strategy at RBC Capital Markets in London. “They want to push down yields all the way along the curve.”

http://www.bloomberg.com/apps/news?pid=206...;refer=currency

It would appear the markets are beginning to show that the UK has already reached about as low as it is going to get. Time for the Euro to come under pressure.

Not really sure what will happen with the US dollar but i suspect it might weaken slightly in the next few weeks with the GBP strengthening slightly.

The Baht as usual will defy all logic and probably become the most bearish currency in the world trading at 35 US$ per Baht due to it's immense competativeness in the world trade stakes.

[chiang mai]

I predict 80thb to the GBP by this time next year.

Let's come back to this post and see what happens.

I'll fly by on my pig and check to see at that time!

[Naam]

I predict 80thb to the GBP by this time next year.

Let's come back to this post and see what happens.

I'll fly by on my pig and check to see at that time!

[colibra]

I see you finally found the right avatar Naam.

[chiang mai]

I predict 80thb to the GBP by this time next year.

Let's come back to this post and see what happens.

I'll fly by on my pig and check to see at that time!

I sense the recovery process is almost complete Doctor, well done.

[Chaimai]

45 Baht per Pound as a short/medium term proposition seems quite likely to me.

Short term 2 baht per £ long term 99 baht per £

I could be wrong??

The problem with this is you haven't built in any margin for error!

Oh i think Ive pretty much got all bases covered there, lets see whose right in 12 months

I think you are talking out of your hometown - most of us would not survive the 'short-term'

[john1000]

The pund is weak because of Mr Brown borrowing so much, and making moves which are seen as acts of desperation by the rest of the world.

Pound=30 in 6 months will rise again in 2 years to about 55. IMHO

[chiang mai]

I think the GBP/THB range for the next twelve months is in the order of 48/55.

[Naam]

I see you finally found the right avatar Naam.

i tend to agree as it would (most of the times) depict my thoughts/feelings when i read the "economic" section of Thaivisa.

[Soutpeel]

I predict parity between THB and GDP by year end...

[lannarebirth]

I was passing on my condolences to a British friend of mine, with respect to the Pound. He emailed me back this response. Thought I'd post it as he's about the most financially astute Brit I know:

"Iindeed - a one way ticket to hyperinflation.

Basically the bankers were told to relax credit to produce "an economy" since 1) 1996+ the UK essentially is a chain of servicing cost rather than anything to export 2) taxation on such easy-money profits would provide gov't spending & vast public sector increases to hide the structural mess of the UK economy.

Likewise the bankers pass the bill back to the gov't, the gov't wanted total deregulation in order to make big taxes & party contributors/lobbyists to make fat cat profits. All a winner - except the taxpayer who is treated as a dumb mug headed to the poorhouse.

ST...

- UK corp bonds see less liquidation to raise cash

- UK gilts however peak in price, not a reserve currency

MT...

- UK currency declines further, already -35% against US$

- Overseas buyers demand higher yield, affects mortgages/loans

- Consumer prices hit by 35% devaluation in H2 2009

- Retailer credit lines still pressured by concern about forex impact

LT...

- Inflation jawboned down by meeja & gov't, currency falls

- Eventually the market forces rates to rise, recovery stalls

Further quant-easing required.

I think we may see a smoke-n-mirrors:

- They INDEED raise interest rates H2 2009 to boost yields

- They HOWEVER quant-ease again to pump money in

Creating appearance of control when in reality burning the currency.

"UK is the counterparty to USA" - in that we have a merry-go-round of inextricably interlocked super-financial-services. CIA citing UK as the world centre for money laundering, anything to create financial service profits to prop up gov't spending & public sector jobs.

At some point the music is going to stop.

1) Will be interesting to watch Ireland re Iceland-II.

2) Then watch the UK re Staglation Hyperinflation.

I am certain the UK is the "bigger AIG" re counter-party mess.

Consumers have NO IDEA just how massive the devaluation was.

The banks do - which is why they are so tight on credit lines since your easy-money funded business is hit by 20-40% increase in costs. They know 1) sales will collapse if they stick prices up 20-40% AND 2) they know the consumer is buried in debt in most instances.

Hence the "we must all act as one" devaluation.

China may not like seeing its currency appreciate - particularly if it feeds through into unrest. It is not going to stimulate consumer consumption. It is most likely going to competitively devalue. The same may be true of the whole of Asia - India included.

The real problem will be if China goes after German bonds over USA.

That would eventually destroy german competitiveness.

Lots of very big bets going to be made in forex this year.

No doubt another LTCM from that when someone gets it wrong :-)

Realise eventually the hedge funds will get the easy money.

So a miserable environment. Cash is king.

- 64% Cash

- 2% UK Treasuries - can't risk more re future price pressure

- 24% Bonds of multiple foreign currency - forex hedge

- 6% Gbl Equities - global recession so MSCI usefully "cratered"

- 2% Gbl Energy - oil/inflation play re imported energy

- 0-2% Gold etc - currency play

Bringing up a UK Treasury Fund (Allianz Pimco Gilt Yield Acc) if you turn "off" the total-return and look at price there is a 22% downside on price just back to previous "normal channel" range. UGGLYY

http://www.h-l.co.uk/funds/fund_performance/sedol/3138328

Very useful to turn on/off total-return vs price on bond/treas charts, most websites simply show total return which hides a lot.

Ah, I regret selling gold as a trade for £240->320 some years back :-) "

[madwest]

With the euro currencies getting weaker against the Bath, people are not going to be travelling on holiday, so in the long term Thailand will be affected, as it will no longer be a cheap holiday destination for foreigners.

This will mean fewer visitors, so less need for staff in hotels and other tourist related businesses. We have just returned from our holiday, and will not go back again this year as we normal do, due to the strong Bath, and spoke to many people who said the same.

Also Thai export will be affected, as Thai goods are more expensive due to the strength of the Bath, neighbouring countries has already devaluated their currencies to make their goods more attractive for export, so give it 6 to 8 months, and the Thai Bath could loose a lot in value to these circumstances.

So for Thailand's sake, I hope the Bath becomes cheeper, or they will join the downturn when othe countries starts to recover, due to the delayed affect of above.

Edited March 8, 2009 by madwest

[Naam]

So for Thailand's sake, I hope the Bath becomes cheeper, or they will join the downturn when othe countries starts to recover, due to the delayed affect of above

you don't say!

[The Philosopher]

Does anyone have any predictions as to how the pound will do against

the baht this year. I do need to bring some funds from the UK, but I'm prepared

to wait till later in the year if the baht will increase.

Do you think theres a chance of it hitting 70 again?

Many thanks

looks like its heading for a new low today

[mommysboy]

Does anyone have any predictions as to how the pound will do against

the baht this year. I do need to bring some funds from the UK, but I'm prepared

to wait till later in the year if the baht will increase.

Do you think theres a chance of it hitting 70 again?

Many thanks

looks like its heading for a new low today

This will be the darkest week for the pound, could go as low as 45.

[12DrinkMore]

This will be the darkest week for the pound, could go as low as 45.

http://www.independent.co.uk/news/business...on-1641128.html

And then it will get darker and darker.

Parity with the EUR and then parity with the USD, we could now easily get to 35 Baht.

Yep, it's the

The Great British Sale of the Century : All Pounds Now Half Price

Thank you Brown, thank you Darling, thank you King and a big THANK YOU to all the fuc_kwits on the MPC

[chiang mai]

This will be the darkest week for the pound, could go as low as 45.

http://www.independent.co.uk/news/business...on-1641128.html

And then it will get darker and darker.

Parity with the EUR and then parity with the USD, we could now easily get to 35 Baht.

Yep, it's the

The Great British Sale of the Century : All Pounds Now Half Price

Thank you Brown, thank you Darling, thank you King and a big THANK YOU to all the fuc_kwits on the MPC

If we must get into playing the blame game, I'm not sure that I would start with the names you used to head up my list. In all fairness this is a fairly unique situation and it does span the globe and there's hardy a proven script that can be selected and followed - folks such as Darling, King and the members of the MPC are simply following a strategy that seems reasonable and logical to many economists. Indeed I would have to Brown's name pretty close to the top of the list if not at the very top. Brown has much to answer for as a result of his mismanagement of the economy and financial affairs of the country for the past ten years.

But my list would show Joe consumer as occupying a prime position on the list for having such greed and extending himself on credit so freely without thought for the consequences. It's a bit like alcohol, do you blame the people who make it and sell it for the high degree of drunkenness and the loutish behavior that follows or do you blame the individual for having no self control. For my part I blame the latter in almost every case since the alternative is a restrictive society where there is little freedom of choice. So it is with credit, we've now gone from freely available credit for anyone to very little at all - in short it's been taken away from us because we've shown that we don't know how to use it properly and can't manage it, quite right too.

[lannarebirth]

Another way to look at it is, you could instead thank all those same people for keeping it up as long as they did.

[Naam]

This will be the darkest week for the pound, could go as low as 45.

And then it will get darker and darker. Parity with the EUR and then parity with the USD, we could now easily get to 35 Baht.

The Great British Sale of the Century : All Pounds Now Half Price

Thank you Brown, thank you Darling, thank you King and a big THANK YOU to all the fuc_kwits on the MPC

As the Bank prepares to inject £2bn into the economy tomorrow, in the first "reverse auction" of UK government securities, the prices of British government paper were driven up to fresh highs, and, with them, yields collapsed to half-century lows. Yesterday, the benchmark 10-year UK gilt yield slid to a low of 2.95 per cent, the lowest since records began in 1958.

gone are the days when i received 13.50% on UK gilts

[AlexLah]

You guys are still optimistic, you think there still will be Pounds at the end of year?

Pounds of what?

[12DrinkMore]

If we must get into playing the blame game, I'm not sure that I would start with the names you used to head up my list. In all fairness this is a fairly unique situation and it does span the globe and there's hardy a proven script that can be selected and followed - folks such as Darling, King and the members of the MPC are simply following a strategy that seems reasonable and logical to many economists. Indeed I would have to Brown's name pretty close to the top of the list if not at the very top. Brown has much to answer for as a result of his mismanagement of the economy and financial affairs of the country for the past ten years.

But my list would show Joe consumer as occupying a prime position on the list for having such greed and extending himself on credit so freely without thought for the consequences. It's a bit like alcohol, do you blame the people who make it and sell it for the high degree of drunkenness and the loutish behavior that follows or do you blame the individual for having no self control. For my part I blame the latter in almost every case since the alternative is a restrictive society where there is little freedom of choice. So it is with credit, we've now gone from freely available credit for anyone to very little at all - in short it's been taken away from us because we've shown that we don't know how to use it properly and can't manage it, quite right too.

I could blast away with a long list of issues that Brown simply ignored or mismanaged. But I have already done that so to avoid myself getting worked up over it again, lets take Joe Consumer.

- why didn't Brown step in when deposit free mortgages were on offer?

- why didn't Brown clamp down hard when self-certified 125% mortgages were on offer, instantly plunging the debtor into 25% negative equity?

- why did Brown take the house prices OUT of the measure of inflation that the MPC had to use, so that house prices were no longer considered in making the interest decisions?

I think the issue is that it is very necessary to RESTRICT the amount of credit available to prudent levels and not allow the population at large to binge away on it, releasing equity for holidays and cars etc. The banks together with the politicians worked VERY hard at forcing seemingly bottomless credit down our throats, creating the massive property bubble. We elect politicians in the vain hope that they will LOOK AFTER US and guide the economy along a steady path. In the end we have been severely let down, and it now transpires that they have only looked after themselves and banks.

And now Brown/Darling/King have embarked on the biggest credit binge that the world has ever seen, by borrowing immense amounts money from the tax payers that can never be paid back and shoving into the banks in the ridiculous endeavour to convince the population to borrow more of THEIR OWN money and keep the house prices rising. Unbelievable.

This is an absolutely crazy scheme, which has already set the food price inflation up to double digits. Who the fuc_k cares if the lcd tvs, washing machines, cars are coming down in price?

I agree that the world is going through a difficult period. But the UK is going to suffer the most by far.

And what annoys me the most is that Brown is off on his save the globe horse, trying to persuade everybody else to screw up their economies as well. The man is surely certifiably insane.

Please can we have somebody who talks sense running the country?

http://www.telegraph.co.uk/news/newstopics...y-medicine.html

He said: "There is a danger that governments generally will think that the solution is to go ever deeper into debt. That troubles me because I don't think it is.

"My sense is that over the last month or six weeks the sense of restraint how far you go into debt seems to have disappeared and that troubles me.

"There is a mood developing that it does not matter how much you are going into debt. I am not sure that is a sensible thing."

Where is the corresponding balancing point of view in the UK? Brown the crusading dictator has taken over and won't listen to anybody else.

God help us all in the next two decades of penury and servitude to the debts he will leave.

[mommysboy]

What is repeatedly missed is that every major economy is in the same boat, and some seemingly worse, eg, Japan.

People argue as if UK is in isolation.

[scottyd]

Awwww man, it's not going down again is it? I was hoping it would just stay above 50 to the pound. If it hits 45 i'm staying home.

[12DrinkMore]

What is repeatedly missed is that every major economy is in the same boat, and some seemingly worse, eg, Japan.

People argue as if UK is in isolation.

Japan has a trade surplus coupled with a humongous amount of Yen recently taken home after the carry trade unwound. Anybody seen any bank bailouts in Japan recently?

The other Asian countries have trade surpluses and foreign currency reserves. Anybody seen any bank bailouts here?

The US can print the World's reserve currency.

Europe is struggling but the countries seem to recognise that the fight to stay in the Euro is better than the pain of getting out.

The UK has Brown running the show, a man who thinks he should be in charge of the economy of the Universe, and who commands no respect anywhere. He was not elected by the voting population and never will be. The UK is not in isolation, but it is in the worst economic shape of any country in the world. An industrial base run down in favour of the banks, a banking industry that is sinking rapidly, and managed/nationalised by Brown. The only money being made in the UK is created by Brown writing a few lines to King. Which could result in another 1,500,000,000,000 yes 1,5 Trillion created out of thin air by the magic of the Fractional Reserve Banking system. Add in the couple of Trillion liabilities that have been guaranteed by Brown, er sorry, the tax payer, and I cannot see a happy ending.

But please, give me a positive prognosis for the financial-cancer ridden patient being destroyed by Brown's Chemotherapy.

Edited March 10, 2009 by 12DrinkMore

[mommysboy]

What is repeatedly missed is that every major economy is in the same boat, and some seemingly worse, eg, Japan.

People argue as if UK is in isolation.

Japan has a trade surplus coupled with a humongous amount of Yen recently taken home after the carry trade unwound. Anybody seen any bank bailouts in Japan recently?

The other Asian countries have trade surpluses and foreign currency reserves. Anybody seen any bank bailouts here?

The US can print the World's reserve currency.

Europe is struggling but the countries seem to recognise that the fight to stay in the Euro is better than the pain of getting out.

The UK has Brown running the show, a man who thinks he should be in charge of the economy of the Universe, and who commands no respect anywhere. He was not elected by the voting population and never will be. The UK is not in isolation, but it is in the worst economic shape of any country in the world. An industrial base run down in favour of the banks, a banking industry that is sinking rapidly, and managed/nationalised by Brown. The only money being made in the UK is created by Brown writing a few lines to King. Which could result in another 1,500,000,000,000 yes 1,5 Trillion created out of thin air by the magic of the Fractional Reserve Banking system. Add in the couple of Trillion liabilities that have bee guaranteed by Brown, er sorry, the tax payer, and I cannot see a happy ending.

But please, give me a positive prognosis for the financial-cancer ridden patient being destroyed by Brown's Chemotherapy.

Well this is really defensive pessimism - you need to accept the grass is not greener anywhere at the moment, save a few backwaters like Thailand that are just about to experience the full hit.

Simply reread my previous posting and realise that all major economies are in the same boat.

Maybe I'm missing something : US prints money - an advantage, UK prints money - a disadvantage.

Forgive me if I'm wrong but US economy on course for 5% contraction, Japan I think may be double figures.

You're arguing minor differences, you need to see the wider picture.

[12DrinkMore]

Well this is really defensive pessimism - you need to accept the grass is not greener anywhere at the moment, save a few backwaters like Thailand that are just about to experience the full hit.

Simply reread my previous posting and realise that all major economies are in the same boat.

Maybe I'm missing something : US prints money - an advantage, UK prints money - a disadvantage.

Dunno whether you are missing something, but that is how it works for the moment.

You're arguing minor differences, you need to see the wider picture.

The whole deal revolves around debt, and the worst debt is in the UK, take all the bailouts, the existing budgetary deficit, the printing of money, the underfunded pension schemes. Who in their right minds will invest in the UK in preference to investing in say Asia? Profits will be taxed to the hilt, the employees will be taxed to the hilt. The damned debt has to be paid off, unless Brown rewrites the rules and defaults, leaving a nation of paupers hoping for handouts at the soup kitchens.

Your original post referred to "People argue as if UK is in isolation". it certainly isn't, but the fertile earth doesn't even exists their anymore compared to other countries. And when Brown wants to come to the Global community for funding to support his spending, nobody will take on the risk except at a huge risk premium, so up go the interest rates and taxes even further.

[mommysboy]

Well this is really defensive pessimism - you need to accept the grass is not greener anywhere at the moment, save a few backwaters like Thailand that are just about to experience the full hit.

Simply reread my previous posting and realise that all major economies are in the same boat.

Maybe I'm missing something : US prints money - an advantage, UK prints money - a disadvantage.

Dunno whether you are missing something, but that is how it works for the moment.

You're arguing minor differences, you need to see the wider picture.

The whole deal revolves around debt, and the worst debt is in the UK, take all the bailouts, the existing budgetary deficit, the printing of money, the underfunded pension schemes. Who in their right minds will invest in the UK in preference to investing in say Asia? Profits will be taxed to the hilt, the employees will be taxed to the hilt. The damned debt has to be paid off, unless Brown rewrites the rules and defaults, leaving a nation of paupers hoping for handouts at the soup kitchens.

Your original post referred to "People argue as if UK is in isolation". it certainly isn't, but the fertile earth doesn't even exists their anymore compared to other countries. And when Brown wants to come to the Global community for funding to support his spending, nobody will take on the risk except at a huge risk premium, so up go the interest rates and taxes even further.

I suspect your assessment is way too bleak when it comes to UK.

I believe you are just not providing a balanced argument.