Currency Rates

[Northpoint]

Dear oh dear . . you really don't have a clue about the dynamics of exchange rates, do you?

Are you seriously suggesting the plunging pound and Oz dollar against the baht is some kind of scam?

With this kind of financial sophistication so prevalent, it's no wonder things are in such a mess now.

You seem to know about the dynamicis of exchange rates, unlike the majority of the ignorant ones including myself. Care to explain it to us all ?

[lannaman]

Air fares up, currency rates all low. I'm settling on using a webcam contact my daughters and gkids that way. I was planning a trip to England this Christmas but way too expensive! I'll save mt satangs until next summer when at least it will warmer there, and hopeful the pound will have recovered. I do miss my family there but as I earn Thai baht 'tis impossible to go too often. Anyway - more carbon friendly to webcam them!

[rick75]

Thanks for the answer roamer, its just a bit uneasy to think that that a currency like the baht is gaining ground hand over fist on the Aussie.

Thanks for taking the time to explain this.

[jubby]

Unless everywhere else makes a miraculous recovery monday morning then Sh*ts got to hit the Fan here or I'll eat my Hat.................

..................Anyone know where I can get a Hat made from rice paper ;-0

[Heng]

Best to 'earn' in 5-6 core currencies... and make the Baht one of those core currencies if you're going to live here.

[samuibeachcomber]

Dear oh dear . . you really don't have a clue about the dynamics of exchange rates, do you?

Are you seriously suggesting the plunging pound and Oz dollar against the baht is some kind of scam?

With this kind of financial sophistication so prevalent, it's no wonder things are in such a mess now.

rather than slag off at other comments why dont you give us the benefit of your obvious wisdom

[Tolley]

The rapid fall of the Aussie dollar has been explained by experts as this.

Australian is seen as a commodity driven economy and commodity prices are falling therefore the Aussie dollar is being dumped by overseas investors.

Part 2 of the equation is that interest rates in Australia have dropped therefore Australia is not as an attractive place to invest so foreign capital is exiting Australia.

Add to this that the markets are completely irratilonal at the moment and the Aussie dollar has been vastly oversold so i think in the medium term it should recover but in the short term it could go even lower.

Retirees in Thailand should always hedge a little by having money in a few currencies for emergencies like this.

[stumonster]

rather than slag off at other comments why dont you give us the benefit of your obvious wisdom

you're new around here aren't you ?

people have less jobs , people have less money , people purchase less , demand for raw materials for manufacturing falls , people have less jobs.

until governments use the extra money they print to kickstart construction and increase demand rather than prop up imaginary values the downward spiral will continue.

[Tolley]

The rapid fall of the Aussie dollar has been explained by experts as this.

Australian is seen as a commodity driven economy and commodity prices are falling therefore the Aussie dollar is being dumped by overseas investors.

Part 2 of the equation is that interest rates in Australia have dropped therefore Australia is not as an attractive place to invest so foreign capital is exiting Australia.

Add to this that the markets are completely irratilonal at the moment and the Aussie dollar has been vastly oversold so i think in the medium term it should recover but in the short term it could go even lower.

Retirees in Thailand should always hedge a little by having money in a few currencies for emergencies like this.

[bendix]

Dear oh dear . . you really don't have a clue about the dynamics of exchange rates, do you?

Are you seriously suggesting the plunging pound and Oz dollar against the baht is some kind of scam?

With this kind of financial sophistication so prevalent, it's no wonder things are in such a mess now.

rather than slag off at other comments why dont you give us the benefit of your obvious wisdom

It's very very simple. It's called supply and demand. People are dumping the Aus dollar and pound because they have been vastly overvalued for the past 12 months. Nobody wants them anymore - they are seen as weak. They are keen to sell them. When people are keen to sell anything - a car, a house, a unit of currency - the price inevitably goes down.

Whether they are in fact weak is another thing, but markets arent always rational. In times of turmoil, even if that turmoil originated in the US, the safe money is heading back to the US dollar (I think temporarily).

There - that's simple isnt it?

For the record, my scorn was for the guy who seemed to imply the strong Baht was some kind of scam on the part of Thai banks / businesses. Idiotic in the extreme. As anyone with a basic understanding of the Thai economy will realise that in an economy that relies heavily on tourism and exports, a strong baht is most definitely not desirable.

Edited October 12, 2008 by bendix

[bendix]

Dear oh dear . . you really don't have a clue about the dynamics of exchange rates, do you?

NO!

And I am not responsible for the current financial situation either.

The OP was looking for enlightenment, not sneering.

I get tired of Bendix's sneering too. So many of his posts are of a derisive or sarcastic nature, and many come across as pompous grandiosity at someone else's expense. Such a shame that he chooses to snipe and be spiteful, rather than offering anything constructive, insightful or useful to his fellow human beings.

I know how you feel. A lot of people complain about him. If I were you I would do what I do - put him on ignore.

[Chang_paarp]

<<snip>>

For the record, my scorn was for the guy who seemed to imply the strong Baht was some kind of scam on the part of Thai banks / businesses. Idiotic in the extreme. As anyone with a basic understanding of the Thai economy will realise that in an economy that relies heavily on tourism and exports, a strong baht is most definitely not desirable.

The Thai economy relies VERY heavily on exports,

Automotive production, 11% GDP (Largest manufacturer of pick-ups in the world)

Computer & electronics 10% GDP

(CIA world book cites industry as 43.8% GDP)

Agriculture 11.4% GDP (was below10% for most of the last few years, since 2003, but this year's rice sales took it back over 10%)

Tourism 7% GDP

While tourism is not as significant as some people think it is the public face of Thailand and it is one of the most voisable industries here.

[mahtin]

Dear oh dear . . you really don't have a clue about the dynamics of exchange rates, do you?

NO!

And I am not responsible for the current financial situation either.

The OP was looking for enlightenment, not sneering.

I get tired of Bendix's sneering too. So many of his posts are of a derisive or sarcastic nature, and many come across as pompous grandiosity at someone else's expense. Such a shame that he chooses to snipe and be spiteful, rather than offering anything constructive, insightful or useful to his fellow human beings.

I know how you feel. A lot of people complain about him. If I were you I would do what I do - put him on ignore.

Thank you roamer and bendix for the enlightenment.

[chiang mai]

The Chinese government is buying Baht.

Do you know why?

Well it's for sure not just the BOT alone, that doesn't make sense. If it's not the Chinese it's Asean working towards their joint currency support pact and that kinda makes sense. Promote stronger regional currencies and provide stability, many regional countries already heavily overweight in US Dollars, hedges future trading relationships, it could be any or all of those reasons and more. Let's face it, we were warned many many months ago that Asian currencies would strengthen.

[Gravelrash]

I am not feeling so bad now with 10M Baht in the bank here. Won't have to import for a little while

I trust you have your money in LOS is earning you good interest?

I don't know what rate John B Good is getting, but here is my situation. I brought in Aussie dollars when it was at 31, I then bought into Thai condos returning rent of about 9% averaged. I have a comfortable income sourced locally that is not affected by currency rates. They are not high end and are affordable so I expect occupancy to stay OK.

So to all of you that listened to the geniuses out there that say "grumble, grumble, never spend more in Thailand than you are happy to walk away from, hiccup", tough luck because you listened to the wrong advise from sour people who either never had the money to invest or who are now getting taken to the cleaners with their offshore investments. With stock markets crashing and banks collapsing perhaps the naysayers had it wrong?

I do have more money in Oz property but never need to bring it here as local income is enough, so I don't care what the exchange rate is. I would never suggest anyone to sell up everything at home, just bring in enough to cover your local needs, the rest at home can just build in its own time.

[tracer5050]

I bring what I need and put in my Thai account, I always get a better rate than tranfereing it in even with the world economies in trouble . Just remember never put all your egggs in one basket like your mother told you.

[zorro1]

I am not feeling so bad now with 10M Baht in the bank here. Won't have to import for a little while

I trust you have your money in LOS is earning you good interest?

I don't know what rate John B Good is getting, but here is my situation. I brought in Aussie dollars when it was at 31, I then bought into Thai condos returning rent of about 9% averaged. I have a comfortable income sourced locally that is not affected by currency rates. They are not high end and are affordable so I expect occupancy to stay OK.

So to all of you that listened to the geniuses out there that say "grumble, grumble, never spend more in Thailand than you are happy to walk away from, hiccup", tough luck because you listened to the wrong advise from sour people who either never had the money to invest or who are now getting taken to the cleaners with their offshore investments. With stock markets crashing and banks collapsing perhaps the naysayers had it wrong?

I do have more money in Oz property but never need to bring it here as local income is enough, so I don't care what the exchange rate is. I would never suggest anyone to sell up everything at home, just bring in enough to cover your local needs, the rest at home can just build in its own time.

Agreed. So much B.S about invest your money offshore and rent never own R/E. I know of a few posters who hijacked every property thread here with their extraordinary claims of 30-50% returns in offshore non R/E investments. They are know where to be seen now.

[Chaimai]

I bring what I need and put in my Thai account, I always get a better rate than tranfereing it in even with the world economies in trouble . Just remember never put all your egggs in one basket like your mother told you.

She also told me not to sleep with strange women !

Where would I have been now if I had listened to her advice ?

Seriously, a big thank you to roamer for his explanation. My own 'feel' for the Baht is, in GBP terms, 65. I have seen it swing over 70 and down to current levels over the last 3 years.

I can accept the dollar recovering from 2.03 GBP rate and my feel there is 1.80/1.85.

The weakness now in Sterling and USD before appears to be down to market sentiment and speculation.

Still, the Thai Baht seems to be defying gravity and the economic indicators (and political instability) do not support it's relative strength. Mai bpen rai is OK in LoS but I can't see Wall Street shrugging it's shoulders.

Intervention or pure speculation can be the only answers which SHOULD result in the THB moving back to a number where us Brits, Aussies and Americans feel a lot happier.

I come back to Thailand next week and I shall spend Baht I have in Thai bank accounts until the rate moves in my favour. Then I will revert to converting Sterling via Nationwide ATM withdrawals. Phil Harries may not care at what rate he converts but I have a preference to have my Thai deposits exchanged at 65-70 rather than 55-60.

Edited October 12, 2008 by Chaimai

[BEENTHEREDONETHAT]

Over the weekend Australia and New Zealand have guaranteed the banks in their respective countries. Since there was no guarantee before people were more apt to get nervious and move their $ out to a safer location. Now (hopefully) the desire to protect your $ should be more relaxed for people with $ there.

I was seriously considering moving some of my $ from both countries. With the guarantee I can now wait until the exchange rate becomes more favorable. Which eventually will happen IMHO. I would have hated to pull out of the very favorable interest rates I was receiving.

[zorro1]

Bankwest is currently offering 9% all govt guaranteed. Variable rate of course

[DavidOxon]

Just maybe me being a bit thick here . . . but surely it's not possible

for all currencies to go down? If a currency goes down, then it must be against another one,

and that currency will appear to go up, so there must be as much movement upwards somewhere as downwards

elsewhere . . . or am I wrong?

I had a play on Yahoo currency converter and changed a £1 into a $, a dollar into a Euro, a Euro into a baht,

and a baht back into a pound . . . guess wow much I ended up with . . .. a £1 . . . How does that work?

David

[zorro1]

This will be interesting

[henryalleman]

I don't think anyone really knows. My income is in Oz dollars so hurting right now

The Euro lost nearly 14% towards the Baht in 4 weeks. Was planning to move next april, if the rate is keeping falling down I start to reconsider about moving.

[Naam]

I don't think anyone really knows. My income is in Oz dollars so hurting right now

The Euro lost nearly 14% towards the Baht in 4 weeks. Was planning to move next april, if the rate is keeping falling down I start to reconsider about moving.

no estimates out of thin air please €UR lost 9% vs. THB in 4 weeks

[wileycoyote]

You are right,of course,but I can't explain it either

[henryalleman]

Can anyone explain why the baht is so strong against the pound , about 6 months ago it was in the region of 70 to the pound now its as low as 56 , all economies are in trouble and with the political turmoil in thailand it just does not make sense , could someone please enlighten me . many thanks .

Straightforward sensible question. Firstly there is very little trade directly sterling-v-baht, or aussie dollar for that matter. Its USD-v-THB that matters. The baht is high, thats related to the amount of baht that is being bought on the foreign exchange markets. Your quite right to point out with all the political turmoil in Thailand it doesn,t make sense for the baht to be so high. The best guess is that the BOT is buying baht and that is keeping the price high, whats certain is that someone is buying baht, some say the Chinese but theres no proof for that.

My own guess, reasoning, call it what you will, is that the BOT is quite aggressively buying baht and that it is not simply an economic reason rather than a political one. There is indeed political turmoil here and in times like these governments want to appear strong and want their currency to appear strong. If that is what they are doing then at times like this its a very risky strategy, very costly strategy. One of the reasons the Aussie dollar is weak at the moment is that their gov has decided there is little point in spending vast amounts trying to prop up the currency when the markets have already decided its weak and they are selling off the currency.

Political turmoil in Thailand, markets quiet, lets sell baht...exchange rate rises. The greatest economic crisis since the 30's and the baht is a side show, a midget currency that its government or speculators can keep high..both for different reasons.

Every reason to believe this week will put the cat amongst the pigeons. As dire as it might be for western economies the attention will certainly shift to those economies that depend on the export markets in the west to survive. The theory that Asia is somehow decoupled from the west has been put to bed, Japan has shown that in its falls...and Japan is far more of an important export market to LOS than it is Europe for example.

To predict anything right now you might as well go tattoo on a soap bubble, ok I'm using a very fine needle but I believe that LOS and its currency is about to take a hit, I said it weeks ago here,

http://www.thaivisa.com/forum/Thailand-Exi...le-t214774.html

At the end of the day I would just sit tight. I don't believe I'm a doomsayer, I simply believe that all the factors are in place for Thailand to take a hit, a megahit....comeon....but if LOS has got to you then you'll believe that despite the fact that the USA, Japan, EU, the IMF, believe we are probably facing the biggest economic crisis ever...the KIngdom will go marching serenely on, cue the song from "Bridge on the River Kwai"

Maybe the reason for the strong Thai Baht is more simply. Next month there is an economic Asean summit in BKK. Thats why Thailand do everything to protect the Baht so they can show off that the Thai economy is still standing strong. Also the funeral of the princess in November where many foreign guests are invited could play some role. The Thai government don't like to have an financial crisis on their hand on that moments.

It can be ridiculous thinking of my part, but we all know that keeping up appearance is of the utmost importance in LOS.

[henryalleman]

I don't think anyone really knows. My income is in Oz dollars so hurting right now

The Euro lost nearly 14% towards the Baht in 4 weeks. Was planning to move next april, if the rate is keeping falling down I start to reconsider about moving.

no estimates out of thin air please €UR lost 9% vs. THB in 4 weeks

I do apologize for the typing error on 15/07 the rate was 53,1017

on 20/10 the rate was 45,8283

the Euro, lost 13,69%

In a period of 14 weeks and not 4 weeks

source BOT, historical rates telex tranfers

[DavidOxon]

Well I for one wish it would right itself soon, I have a house to pay for!

Anyone want to loan me 1.5m till the rates are better?

David

[ThaiPauly]

Well I for one wish it would right itself soon, I have a house to pay for!

Anyone want to loan me 1.5m till the rates are better?

David

Unfortunatley David, there is no guarantee that they will get better. I remember you posting about needing to transfer funds to pay for your house a month or so ago.

The rate then was just over 60.

Today its showing just over 57

I never thought it would hit these lows...and it's not been as low since I have been in LOS for 6 years, but has been as low as 40 before, but every currency apart from the dollar is falling against the baht.....

I would take it now if I were you...it could be 50 within the next month...who knows?

[DavidOxon]

Sadly it's locked up until end of November!

And the rate has dropped another 1bht since my post earlier this morning

now down to 56! aaaaargh!