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Baht/dollar Speculators ?


cojones

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BOT checks rise of baht in London

Published on Nov 24 , 2004

The Bank of Thailand yesterday carried out a surprise baht intervention on the London foreign-exchange market, following signs of irregular appreciation of the currency unit against the US dollar over the past few days.

According to a BankThai foreign exchange dealer, the central bank stepped in when the baht rose to Bt39.66 against the greenback, up from Bt39.83 at the open.

The baht then fell suddenly to Bt39.78, but managed to resume its upward movement to close at Bt39.67.

Bank of Thailand deputy governor Bandid Nijathaworn would neither confirm nor deny the intervention.

“There’s no need to ask. You know what it is,” he said.

“The baht moved up pretty fast, sometimes too fast. We are closely monitoring the situation,” he added.

After passing the Bt40 barrier earlier this week, the baht is now at its highest level against the greenback in seven months.

Anticipating a further depreciation of the dollar, Thai exporters are now selling off the greenback, which has further strengthened the baht.

Though the strengthening is in line with the Japanese yen, the recent sharp gains convinced the market of speculative buying activity.

Since the end of October, the baht has strengthened 3.33 per cent against the greenback, but weakened 0.74 per cent against euro and 0.89 per cent against the yen.

The recent rise in the baht has been attributed to inflows on the Thai stock exchange, and partly the result of foreign-exchange gains.

Anoma Srisukkasem

The Nation

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Foolish to 'bet' on the baht, imo. The playing field isn't level with the billions of baht being poured in to try to stabilize the baht. That has been government policy for many years, and was one of the primary reasons for the collapse of the baht in 1997, when the government couldn't cover the margin calls...

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