Baht Devaluation Again - Is It Possible?

[Maizefarmer]

Around 10 years back the Baht was at something like Baht 25 / $ 1!!! - and the Thai suthorities pannicked. Overnight we saw the Baht devalued, and for a period of time it contiued to plummet with something like the high 60's being reached, at which point it turned and over the last 10 years it has slowly got stronger and stronger.

Then the whole of Asia was in a financial doledrum, and althought the reasons now are somewhat different for the Bahts relative strength aginst the $, it none-the-less is having a big effect on exports.

What are the chances that we will see another devaluation sometime during this year?

Edited March 20, 2008 by Maizefarmer

[Ijustwannateach]

Hope it's low; I don't think exports are the end-all, be-all of the economy here- plus the baht relative to other, stronger currencies (like pound and euro) hasn't changed all that much (and US influence, like the dollar, is dropping).

[clausewitz]

I know you know that the baht was pegged against the dollar until 1997, right?

[Prakanong]

I doubt very much you will se a devaluing like that this year.

97 was a whole different ball game with a perfect storm across many Asian economies gathering - the only place looking that shakey currently is the USA and then a number of factors would need to feed off each other all at once.

[jdinasia]

Thw baht was pegged against the dollar until 1997 --- then it was floated ... it was never 'devalued'. When it floated it reached 83:1 briefly then quickly found its real value around the 40's mark. Today's issues are about the dollar being worth less and the baht being one of the strongest currencies around

[quiksilva]

Yup its a completely different scenario today.

[britmaveric]

Likely because lets face it the thai economy isn't doing so well. See a precipitous free fall at some stage, however when is anyone guess.

[JetsetBkk]

Likely because lets face it the thai economy isn't doing so well. See a precipitous free fall at some stage, however when is anyone guess.

It would be nice if it happens before December - the next 1,000,000 baht transfer for me.

[teej]

Anything is possible....Except a Baht devaluation. Not going to happen. Different circumstance completely.

Brit I've give you the keys to my Tractor Italiano if the Baht is devalued. Granted you'll have to move to HK to use it....

Not going to happen. If anything as long as the dollar weakens, expect a stronger baht. Period.

[Naam]

Likely because lets face it the thai economy isn't doing so well. See a precipitous free fall at some stage, however when is anyone guess.

the thai economy is not exactly doing well since a couple of years. did the Baht weaken or strengthen vs. most major currencies? we had rate cuts, not one but several. what happened? Baht did not weaken but got stronger. USD stronger by an average of 4% vs. major currencies. did the Baht weaken 4% vs. the Dollar?

[britmaveric]

No - but I am thinking another collapse is coming. Far diff than rate cuts.

[longway]

No - but I am thinking another collapse is coming. Far diff than rate cuts.

you have been saying that for years now.

[britmaveric]

No - but I am thinking another collapse is coming. Far diff than rate cuts.

you have been saying that for years now.

And one of these days I will be right.

[JetsetBkk]

No - but I am thinking another collapse is coming. Far diff than rate cuts.

you have been saying that for years now.

And one of these days I will be right.

I hope so!

[thaihome]

It is widely believed that the BOT is trying very hard to keep the baht above 30. Of course they tried very hard to keep it above 40, then 38, then 35, etc. In today’s world, a small central bank like BOT does not have much influence on the market, the reserves are just not there nor should they be squandered trying influence the market.

I am eagerly awaiting this cycle to top out and start the other way, but I'm afraid it could be several years.

TH

[LaoPo]

It is widely believed that the BOT is trying very hard to keep the baht above 30. Of course they tried very hard to keep it above 40, then 38, then 35, etc. In today’s world, a small central bank like BOT does not have much influence on the market, the reserves are just not there nor should they be squandered trying influence the market.

I am eagerly awaiting this cycle to top out and start the other way, but I'm afraid it could be several years.

TH

Baht per US dollar - 33.599 (2007), 37.882 (2006), 40.22 (2005), 40.222 (2004), 41.485 (2003)

source: CIA

LaoPo