BOT Revokes Capital Control Measure From Monday

[distortedlink]

Toxin back and the next day the THB onshore/offshore rates are equalised, resulting in a stronger THB. Toxin apparently has not come up with the cash he promised on the takeover of Manchester City football club. He also has billions still in Thailand, how opportune for him that the Baht has become stronger...

At the current rate the THB will cause massive problems with Thai exports that have already been suffering. The tourist industry will also have major problems, hotel rates are already becoming very expensive, USD 50/night is now at the very low end of the scale. And what are you paying for? Phuket/Samui/Pattaya/Krabi are rapidly becoming cess pits of tourist development. Might as well stay in Europe, or try Vietnam, Philippines, Malyasia and Indonesia.

Thailand value for money? Cheap? Well, maybe for the package holiday makers, who buy beer at the 7/11, otherwise I don't think that it is good value for money.

Nope, sorry for you Thais, you had a good thing going and screwed it up.

Bye bye.

Yes, I agree with you to a point.

These are becoming harsh times for foreign residents here.

The crippler is the ever increasing hyped up prices of food and services. We make cut backs but than prices catch up, so we make more cut backs. Bank interest rates are a joke and now to add more pain to the misery, the exchange rates are falling through the floor.

Below is a summary of my basic cost of living increases from the beginning of 2006 to the end of 2007.

We are a family of 3. Our eating habits and use of services has varied little in the last 2 years.

FOOD: increased 7.57%

SOFT DRINKS, BEER increased 11.32%

DRINKING WATER increased 13.72%

ELECTRIC increased 37.53%

COOKING GAS increased 52.58%

TELEPHONE increased 12.3%

PETROL increased 10.03%

MOTORBIKE TAX increased 4.58%

MOTORBIKE INSURANCE increased 10.19%

The above in total cost 7.98% more in 2007 than in 2006.

Plus cost increases for social, clothes, medical and taxi fares.

In money my cost of living expenses increased by 26000 baht in 2007, but from this year with rocketing inflation, I suspect that my expenditure for 2008 in going to way exceed that of all my previous years here.

In Chiang Mai where I live, nightlife and regular socializing used to be taken for granted as a way of life here, over the last few years, much of what is left of the social scene after the big close down are only remnants of what they were. These now have become so expensive that nights out has become a rare luxury.

Many of us retirees with time on our hands do enjoy going on line, but Internet services here is inefficient as is other home entertainments such as UBC satellite TV

For some of us who have committed themselves to Thailand, bought property and sold up everything in their home countries, it is not so easy to just pack up and go, but for those who are considering retiring in Thailand, think twice about it as much has changed in the last 5 years.

Edited March 2, 2008 by distortedlink

[ray23]

Yesterday at 1200 hours Bank of Bangkok ATM 31.66 I really don't expect that today, but we will see.

Does this hurt the Thai's not the big guys, the stock market just got what it wanted. It is about to hurt one family here that I know of, our housekeeper and friend is about to lose her job, along with the college fund for her children. That is going to be a very sad day around here. But. really not much I can do about it. Will that hurt us in reality no, never really needed a houskeeper in the first place. But it's really going to hurt in her home.

Lets see you get more purchasing power from the baht, anyone seen any imported goods going down in price? Me I have seen just the opposite on the things I buy.

Read an article in the nation or the post don't recall which one the other day, the Japanese are sitting on that money that we all heard so much about coming into the country last year. Why they are losing to much money in the rate of exchange. So the baht appreciating more should help them send that money here very quickly. Why is this significant because they build factories, not play the stock market. There is no doubt the market will see funds invested because of this, but will anything long lasting come from it. Time will tell.

I keep hearing the dollar is going to turn around at the end of the year. Maybe but it sure doesn't feel like it at the moment. Even if it does is that going to change the baht, it is appreciating against most western currencies these days.

Why Thailand? It is smaller then my home state of California. How did as place wonderful as it is, but a small country end up in the top ten traded currencies in the world. Now guys that is one I can not answer.

This has been an amazing thing to watch. My income is going down but my assets are going through the roof. The house I bought in Udon some two years ago, cost me in dollars 31,818. If I sold it today 300K baht under the current market. In dollars I would get 64,515 an increase of $32,577. So if I were packing it up ang going back to the states I would leave here with more then I came with.

Well this is home I'm not going anywhere. So I have two choices increase the income, or cut expenses. I'm cutting expenses. So a lot less in time in bike touring. But hey look at the bright side I got lots of time to sit around and complain about it

So yes I may have to let go of a few things in my life, but my life will still be good compared to working 12 hour days six days a week. Realizing people get tired of talking about the dollar, but lets face it folks that is where this is coming from. I think you have to look in that direction to get a feel for what we are really dealing with. There have been seven recessions in the states since WWII, they lasted an average of 12 months. But no one has said we are in a recession yet, so when does the clock start?

I don't count Thailand out, but I don't count out the States either this is not the first time it's been through this. My guess we have a tough year ahead of us. But, it wont be forever.

[tropo]

The euro DROPPED almost 1 baht from 16:42 to 16:48. Never seen anything like this in my life.

There is no currency in the world which is rising as fast as the baht.

I notice you when the euro was 51 bahtr 1 ,the dollar was by no means as weak as now (dollar was below 1.40 for 1 euro).

Wrong! You're jumping to incorrect conclusions.

The Philippine php has far out performed the baht in the last year, and also over the last 2 years.

1 year from 49 to 40 against USD - an 18% gain. In contrast baht has only moved from around 33 to 31 in this time - a 6% gain.

2 year from 53 to 40 against USD - a 25% gain. In contrast the baht has moved from 39 to 31 in this time - a 20% gain.

The baht vs peso has dropped from 1.5 to 1.3 in the last year - a 13% drop.

The AUD has gained almost 14% against the baht in the last year, and held over the last 2 years.

The NZD has gained around 11% against the baht in the last year, and held over the last 2 years.

[thaigene2]

There's another angle to this topic that affects most of us -- and hasn't been widely discussed - the import of foreign goods for sale here. Why aren't those imported goods dropping in price? If big Thai retailers (e.g. Villa, Tesco, etc) are spending Thai baht to buy US beef or California importing wine (for example) sold in US Dollars, why haven't those prices been slashed on the shelf?

Instead, even some imported goods are 'climbing' in price - with the excuse that it's 'inflation or rising fuel prices' to blame.

The other argument that retailers were absorbing the currency fluctuations before and so are simply clawing back losses from when the Dollar was strong doesn't wash for me. If this issue gets raised enough (especially in the vernacular press) I hope we could see some proces drop.

(I would like to start a new topic for more discussion on this but can't in this Forum as it's a Mods only Forum).

Edited March 2, 2008 by thaigene2

[wintermute]

This is a nightmare., Thailand is becoming far too expensive

Expensive for who? Maybe for English teachers and skint expats but to those that are still earning higher end western wages and or well invested it's a relatively small bump. Even with the 25% increase in expenses due to the baht and inflation i've seen over the last few years in Thailand it's still cheap compared to most other places.

[huma79]

If the exchange rate is what is keeping some people in Thailand (as opposed to Viet Nam or China as a few posters have said) then maybe it is time for them to leave. I for one am living here for quite a few other reasons. Bon Voyage

Thank You! It's nice to see someone else here without a self-righteous view of the country they are guests in.

[wintermute]

There's another angle to this topic that affects most of us -- and hasn't been widely discussed - the import of foreign goods for sale here. Why aren't those imported goods dropping in price? If big Thai retailers (e.g. Villa, Tesco, etc) are spending Thai baht to buy US beef or California importing wine (for example) sold in US Dollars, why haven't those prices been slashed on the shelf?

Why should they slash prices if supply and demand remains constant? Slashing prices doesn't mean they will automatically gain more customers to make up for the lower prices especially if there's a built in hi-so or expat customer base already and that base is only a small percentage of Thailand's overall population.

Instead, even some imported goods are 'climbing' in price - with the excuse that it's 'inflation or rising fuel prices' to blame.

Yeah it's probably an excuse because freight shipping is still cheap as ever but import duties is another story.

[huma79]

English teachers shouldn't be complaining either - they are earning more than they were 5 years ago when you take the exchange rate into account.

This is a nightmare., Thailand is becoming far too expensive

Expensive for who? Maybe for English teachers and skint expats but to those that are still earning higher end western wages and or well invested it's a relatively small bump. Even with the 25% increase in expenses due to the baht and inflation i've seen over the last few years in Thailand it's still cheap compared to most other places.

[wintermute]

English teachers shouldn't be complaining either - they are earning more than they were 5 years ago when you take the exchange rate into account.

This is a nightmare., Thailand is becoming far too expensive

Expensive for who? Maybe for English teachers and skint expats but to those that are still earning higher end western wages and or well invested it's a relatively small bump. Even with the 25% increase in expenses due to the baht and inflation i've seen over the last few years in Thailand it's still cheap compared to most other places.

I'm guessing most English teachers drop their money right back into the Thai economy in one way or another without ever seeing a single baht of currency going back home. The benefits of the baht increase are marginal for people earning baht unless they are getting paid by a Multinational job in baht which would be unusual.

[dunque]

Yesterday at 1200 hours Bank of Bangkok ATM 31.66 I really don't expect that today, but we will see.

Why Thailand? It is smaller then my home state of California. How did as place wonderful as it is, but a small country end up in the top ten traded currencies in the world. Now guys that is one I can not answer.

Thailand smaller than California ? On what criteria ? Perhaps it is ignorance/arrogance like this that is the US's problem

[Supaporn]

English teachers shouldn't be complaining either - they are earning more than they were 5 years ago when you take the exchange rate into account.

This is a nightmare., Thailand is becoming far too expensive

Expensive for who? Maybe for English teachers and skint expats but to those that are still earning higher end western wages and or well invested it's a relatively small bump. Even with the 25% increase in expenses due to the baht and inflation i've seen over the last few years in Thailand it's still cheap compared to most other places.

Words of a prima donna twit.... I do believe it is more expensive for EVERYONE. Though some may not feel the pain as much.... no reason to gloat over your status. Insensitive boor.

[wintermute]

English teachers shouldn't be complaining either - they are earning more than they were 5 years ago when you take the exchange rate into account.

This is a nightmare., Thailand is becoming far too expensive

Expensive for who? Maybe for English teachers and skint expats but to those that are still earning higher end western wages and or well invested it's a relatively small bump. Even with the 25% increase in expenses due to the baht and inflation i've seen over the last few years in Thailand it's still cheap compared to most other places.

Words of a prima donna twit.... I do believe it is more expensive for EVERYONE. Though some may not feel the pain as much.... no reason to gloat over your status. Insensitive boor.

What are you crying about? . If you can't afford to pay a 1-2 baht markup on your bowl of "nooden" or a bar of generic tesco-lotus brand soap then you need a reality check on why you are here in Thailand to begin with.

[marquess]

Most teachers' wages are the same as they were five years ago, there are still people paying 300/400/500 per hour, my electricity bill has gone up by at least 100% if not more in the last five years. There was a time when I could walk around Foodland fill a trolley and it would come to around 1k but nowadays a few things in a basket and it is nearly that. Things are still cheap but not so cheap, therefore one has to be a little more circumpsect! The only bright side is if the Baht would return to the levels that it was at against the pound eight years ago, when it was about 50, this would mean cheaper holidays for those earning here.

[MaiChai]

Prices are rocketing in Thailand. A kilo of pork was 50 baht last year; now its 100 baht. Everything is shooting up in price. Alot of goods you buy here in the supermarkets can be bought for the same price or less in Europe (UK I am comparing against).

For those who are new to Thailand, they think its cheap, but compared to what it was like 5 or 10 years ago, its expensive and the 'old hands' are noticing it. The economy can be extremely volatile and at times not well managed, and I think you would have to be mad to sell up at home and move here with the few rights given to you (not to mention the slow and easily manipulated legal system). I have been in Thailand about 13 years and I would not cut the bridge to return to my home country. Remember you will never be a Thai or be given equal rights, thus dont remove the ability to return to your home country where you have 'citizens' rights. Not to mention when your old and senial and your Thai wife is bored with you and has sided back with her family...

[Old Man River]

A lot are complaining about higher prices. Our current government has been making a lot of noise about bringing prices down. No one really thinks this will happen, but suppliers are fearful they will be forced to freeze their prices. To guard against this, suppliers have bumped their prices up so that if a freeze occurs, the impact will be much less.

[The Philosopher]

This is a nightmare., Thailand is becoming far too expensive

It was 45 abht to the Uk pound in 1987

[marshbags]

http://www.bangkokbank.com/Bangkok+Bank/We...es/FX+Rates.htm

Currency Exchange Rate Date : 29 February 2008

Update : 5 Effective From : 16:50 [unit : Baht per 1 unit of foreign currency]

Currency Description Bank Note Buying Rates Selling Rates, Bill-DD-TT

USD1 USD : 1 30.27 31.80

USD5 USD : 5-20 30.61 31.80

USD50 USD : 50-100 31.03 31.86 31.20 31.30 31.70

GBP United Kingdom 61.13 60.9 63.23 61.80750 61.5575 61.97250 61.9525 62.99000

EUR Euro Zone 47.15 48.48 47.35250 47.46500 48.27750

Get the complete list from the url at the top and a much clearer layout as per list.

I cannot remember the last time the exchange rate was updated as late as this.

If ever ??

Obviously it has anticipated the strengthening, unlike the way they normal close shop on a Friday ???????

Which is generally much earlier than this. especially when the exchange rate moves in favour of our currencies and we have to wait over the weekend to possibly ( if there hasn,t been a shift the other way, in that time ) get more baht for our currencies.

I,ve mentioned on several occasions at the exchange booths that it was ex amount at 14.30 , or around this time, only to be told it is to late to update any late adjustments.

I,ll make a point of going to see what the rate is tomorrow morning and see how it fits in / what it is and compare timing, ect.

Happy days are not here again in more ways than this one............................

marshbags my ?????? !!!!!!!!!!!!

Called at the ex. booth this morning and got the following rates for the pound, which is my native currency.

As of 18.40 on the 29-02-2008 the rates in red are quoted.

I guarantee based on passed visits, that had the change been the other way, the rates quoted at the ex. booth would have been the ones listed on the 14.00 update in realtion to the above url / bank rate information.

These being 62.35 for cash, 63.03 for trav. cheques and 63.19750 for the pound.

marshbags

P.S.

Guess they will have made quite a tidy sum based on the ????? amount of transactions over the weekend and the later than usual updates.

Implimented after what i was told by the ex. staff was to late to act on when i quoted them ( around 14.00 / 14.30 ) and this relating to close on Friday,s by the way, NOT SATURDAY.

They were of course in the sellers favour as against on this occasion, which was a biggish change in the buyers favour.

I,ll save the rest of my travellers for possible weakening of the baht / strengthening of the pound, i,m not desperate to change them at present.

Edited March 2, 2008 by marshbags

[Naam]

The euro DROPPED almost 1 baht from 16:42 to 16:48. Never seen anything like this in my life.

There is no currency in the world which is rising as fast as the baht.

I notice you when the euro was 51 bahtr 1 ,the dollar was by no means as weak as now (dollar was below 1.40 for 1 euro).

Wrong! You're jumping to incorrect conclusions.

The Philippine php has far out performed the baht in the last year, and also over the last 2 years.

1 year from 49 to 40 against USD - an 18% gain. In contrast baht has only moved from around 33 to 31 in this time - a 6% gain.

2 year from 53 to 40 against USD - a 25% gain. In contrast the baht has moved from 39 to 31 in this time - a 20% gain.

The baht vs peso has dropped from 1.5 to 1.3 in the last year - a 13% drop.

The AUD has gained almost 14% against the baht in the last year, and held over the last 2 years.

The NZD has gained around 11% against the baht in the last year, and held over the last 2 years.

sorry Max but Tropo is right. you have to do some more homework before specific making statements

[moo9]

Just a question, does the revoke of the restriction would also allow me now to transfer more that 1 Mio THB in THAI BAHT to a foreign Baht account? For the present, all transaction are automatically converted into Euro , Dollar or another foreign currency.

Thanks.

[Naam]

This is a nightmare., Thailand is becoming far too expensive

Expensive for who? Maybe for English teachers and skint expats but to those that are still earning higher end western wages and or well invested it's a relatively small bump. Even with the 25% increase in expenses due to the baht and inflation i've seen over the last few years in Thailand it's still cheap compared to most other places.

not to talk about the taxman in my home country who would take 48% of my worldwide income! (if he knew about the total )

even declaring a certain amount of income which would tally with a moderate lifestyle in my country and which can't be compared with my present life style the taxman would still demand an amount of taxes which is equivalent to my total expenses in Thailand.

i therefore can't understand statements such as "Thailand has become too expensive" am i the only one who has paid income tax in other countries?

addendum: my statement does not apply of course to my fellow american TV-members who have hardly any possibility to escape the IRS...... except if they have been clever enough to move their holdings out of funny 401k, roth ira, mutual funds based in the U.S., CDs and similar rubbish to a tax haven

Edited March 2, 2008 by Naam

[Seneque]

A lot are complaining about higher prices. Our current government has been making a lot of noise about bringing prices down. No one really thinks this will happen, but suppliers are fearful they will be forced to freeze their prices. To guard against this, suppliers have bumped their prices up so that if a freeze occurs, the impact will be much less.

People who suffer the most is the local thai population (not the high level politicians/army/etc.. who don't give a hoot, don't pay taxes on wine, cars ...etc) . Tell this rural population about inflation, they know what it means, tell them about debt, they definitely know what it means ... Level of debt has never been that high... there is no way out ... Thailand is not only a vassal of grander economies but Thailand is also 'managed' by sheer incompetence ... the reason why they stopped the capital control is the same as the reason why they implemented it in the place : no idea !

take your medecine and be well.

[cclub75]

Total exports comprise about 60% of the economy with approx. 10% being agricultural and other labor intensive related exports. It is this category that is the most concern to the government as it directly impacts those in the PPP's voting base.

Wrong. Take the december's figures (BOT).

Add : Agriculture to fishery, forestry and mining, total = 1,71 billions USD on a total exports of 13,59 billions = 13 %.

Add : "labor intensive products" (from "manufacturing") = 1,4 billions USD

Sub total = 3,11 billions = 23 %.

But... but... look at the details for "manufacturing" group (here). It's a joke to put cement, sugar, molass, ruber into this group... along with cars.

So personaly I would add also "resources based products" (on the first table) = 1,37 billions USD more

Total = 4,48 billions = 32 % of total exports...

We can say that minimum 32 % of thai exports... are poor value added products... that monopolize the vast majority of thai labor...

Voila the reality of Thai's export engine. Fragile at least, I would say...

And we could continue this game. Actually, we could reverse the question : what is the real part of high tech and value added products from total exports ?

So it's very simple : put into the picture a currency problem, plus a decrease of the demand (global slowdown)... and you get quite an ugly perspective...

There is a good reason for the gvt (junta before, PPP now) to push on public expenses (mega projects)... They know very well that the other components of GDP are at risk :

-private consumption = flatline

-Gross fixed capital formation (new investments) = down (at least, for private)

-export = dark clouds on the horizon

-therefore, we have left only public expenses

But, of course, confident we shall be ! Samak-Thaksin will save us.

[guyshown]

in simple terms could someone explain the 30 percent reserves?

thanx in advance

gyshown

[distortedlink]

This is a nightmare., Thailand is becoming far too expensive

It was 45 abht to the Uk pound in 1987

1987 was a whole different scenario.

Firstly the cost of living was about a quarter of what it is now and secondly, Thai bank interest rates were as high as 13%.

In 1987, one could live off interest with only 1 million baht, today it would require at least 11 million baht to be able to live reasonably off the interest.

Using simple mathmatics for sterling amounts, if the rate is 60 baht = £1 today and 45 baht = £1 in 1987, taking in to account the cost of living and interest rates in 1987, than one needed to bring over £22000 in 1987 to live on interest but the equivilent amount today is £183000 to have the same living standards as in 1987.

Edited March 2, 2008 by distortedlink

[ozode]

I have read ever reply on this board. There are some good points, but no one has a complete picture of what is going on. The latests replies have to do with prices, that is detached from the issue of currency appreciation and should be saved for a discussion on inflation, which is also a issue in thailand. I used to be a currency analyst and trader, so I have a little experience in this stuff.

I cannot explain all the things that will go into deciding the value of a exchange rate, in just a paragraph on a page. Some have tried but they have missed a lot of details that are important. The basic gyst of what most of the currency traders are thinking is this. There is mass uncertainty in the US, right now, due to promises made, it looks like the US government is going to have to either significantly raise taxes are they are going to have to start printing money to pay for all the upcoming bills. You match that with the trade deficit, which it looks like the US population is so materialistic that they are willing to sell their own future to the Arabs and the Chinese for a big screen TV and a SUV. That adds to the volitility of the dollars and also decreases the amount of equity in the US, since most of these items depreciate in value.

So basically the dollar sucks, long term, until some of these issues are resolved. Remember in markets you have to buy on the rumor and sell on the news.

Short term the lack of appreciation in the housing market, matched with the amount of debt, particularly unsecured debt, the population has is causing problems in the US. So interest rates are falling, which means there is going to be a decrease in capital inflows from investors outside the US. So short term the dollar sucks too.

Now as far as the Thai baht, the answer for the appreciation in the Baht is primarily you guys. Yes the Farangs in thailand are causing the baht to appreciate. How many of you came to thailand, fell in love the the charm of the country and decided to retire there. Maybe you got a thai wife, maybe you are just living there. Many of you have started doing business there, some may even be shipping products to the US. I know I am. So, you are the capital inflows into the country, whether you are coming for vacation or for business. Many of you who dont stay go home and you take some of the investment ideas with you, so you buy emerging market funds that invest here or you try to invest directly in the market through a international brokerage firm like UBS or something. Now fundementally, the thai baht should not be the fastest appreciating currency in the world. By my measure, the risk associated with investment in thailand is pretty high due to insecurity in the government itself. I mean thailand is changing governments faster than most bananna republics, then you have a largely unskilled workforce and a country that still is not putting the weight in education that it should. Plus you throw into account the fact that speculators cannot directly invest in a traded value of the Chinese yuan, so they have been throwing money at any countries currency that is close to China and in Thailands case, they will benefit tremendously from a stong Yuan and that is what speculators and hedge funds are looking for.

That is the laymans currency picture, for a more complete currency outlook, talk to someone else, because I dont want to write that much.

As far as the idea that the baht is here to stay, that is a farce. It is simply not true. It is here for now, but it will fall, because eventually China will stop being a issue and Farangs due to a strong baht will also begin to take vacations to other places and find places the like better than thailand. So the baht will fall, it might take some time, but it will. The dollar on the other hand will make a comeback at some point, but only after a few of the big issues of the day get solved. For now though, it does not look like anyone is even talking about those issues, which is kind of typical of the country and people that I love. We love to ignore a problem until it either blows us up, or causes us to go bankrupt. Actually, if you look at generational statistics that is typical of the baby boomers. I just hope they dont teach their children anything, otherwise the US is going to have a rough century.

[thailand_tom]

This is a nightmare., Thailand is becoming far too expensive

i agree with you..there is going to be no reason to go to or retire to thailand..if the balt keeps getting stronger..i can go to vietnam . my brother was there last year.said it was beautiful.

[thailand_tom]

i am glad i left thailand a year ago.went back to the usa.other places to go then thailand.dollar keeps getting weaker.i would hate to be an exporter in thailand or in the tourist business in 2008.

[Joe Walshe]

I'm a tad confused here.

I look at http://www.x-rates.com/d/THB/EUR/graph120.html web site regularly and it seems to me that the Euro has just risen in value against the baht. The Baht/euro exchange rate is still much the same as November 2007.

It appears to me that the Baht/dollar rates are the big issue.

[bdenner]

It appears the USD/THB x-rate and American expats are most effected by these measures. To that I say Som Nom Nah you bought it on yourselves by electing a poor administration with their monitory miss management (Sub Prime debacle amongst other things). I say this again (I said it once before and was howled down) It is high time the world economies distanced themselves from the USD and took more notice of the overall picture including Europe and emerging economies of Asia and the Sub Continent.

As an Aussie I, fortuneatly, don't have a problem with AUD/THB x-rates BUT I have had a substancial portion of my superannuation written down due to happenings in the US so I guess we are all in the same boat, just some worse than others.

[Plus]

Ok, what do you think will happen to the baht. If it rises, where will it stop? 30, 29, 25?

It would be more useful to monitor baht vs regional currencies. Do they rise in tandem or not? Thai exports must not be relatively more expensive, especially when the US is cutting back on consumption. They will go for cheaper stuff, quality will matter less.