Thai Baht At Fresh 13-Year High Against Dollar

[george]

Thai baht at fresh 13-year high against dollar

THB Thai Baht Exchange Rates

BANGKOK, October 6, 2010 (AFP) - Thailand's currency strengthened beyond 30 baht to the dollar Wednesday for the first time in more than 13 years.

The unit, which has appreciated around 10 percent this year, roared past the psychologically important level to hit 29.95 baht to the greenback, fanning concerns over the key export sector.

Thailand, in line with other regional neighbours, has seen its currency soar as robust economic growth and a rising stock market attract an influx of capital into the country.

The baht is at the highest level since July 1997, when the currency was first decoupled from the dollar.

The Bank of Thailand is monitoring the situation and is considering a number of measures aimed at reining in the currency.

Usara Wilaipich, senior economist at Standard Chartered, said regional strength had its roots in the impact of the global recession, with a loss of confidence in the dollar.

"Any domestic measure used to curb the situation will only help slow down the effect but will not resolve the problem," she said.

According to Usara, the strong baht would have mixed effects on businesses, with some of Thailand's biggest exporters -- such as electronics, petrochemicals and energy firms -- benefiting from cheaper imports.

But she said agricultural companies, as well as exporters using more local content would lose out, as the stronger baht makes them less competitive.

Strong foreign demand helped the Thai economy to grow 9.1 percent year-on-year in the second quarter of 2010, despite the impact of mass protests in Bangkok in April and May that damaged the vital tourism sector.

Central bank deputy governor Atchana Waiquamdee told Dow Jones Newswires that there was no particular target for the baht and said exports remain strong despite the currency's appreciation.

Interest rates, currently set at 1.75 percent, had a negligible impact on the amount of capital coming into the country, she added, noting that the benchmark rate was lower than many regional peers.

The latest currency movement was suspected to have been challenged by the central bank, with dealers saying it might have bought several hundred millions of dollars to try to curb the rise in the baht.

-- (c) Copyright AFP 2010-10-06

Related link:

Thai Baht Exchange Rates (live updated SWIFT/TT rates): http://baht.thaivisa.com

[Xircal]

It really makes you wonder why a sizeable proportion of the Thai population lives in abject poverty when you read news like this.

[ratcatcher]

I am not a financial expert on FX, so can someone tell me whether the Thai baht has strengthened against the U.S.$ or has the U.S.$ weakened against the baht.

As a Canadian, my CAD is worth around 29.5+- and the AUD is also up over 29 to the THB.

So should the headline read U.S.$ weakens against THB?

Thanks. :jap:

[chantorn]

Exclude the exporters.

Is this good for the general Thai people or not? If the currency in their pocket/bank gets appreciated?

[neverdie]

Exclude the exporters.

Is this good for the general Thai people or not? If the currency in their pocket/bank gets appreciated?

Im not sure what you mean by "Exclude the exporters".

By that, I know you already understand that anyone involved in the business of exporting goods from Thailand would not be enjoying this new found strength. Part of those people exporting goods is the 'farming community' of Thailand, which as you know takes in a fairly large proportion of the poor Thais. Whilst most of them are not directly 'exporters' if their products became undesirable because of their cost then these are some of the people that could negatively be effected by a strong baht. Theres a ripple effect through the community with all of these things.

A different scenario might be a canned fish business that hires thousands of factory workers to produce their product. People stop buying canned fish from Thailand because its cheaper to buy it from (insert country) and suddenly the Thai fish can food company is laying people off.

Of course if your a more wealthy thai an overseas trip will be much more affordable, as will some of those imported products like cuban cigars and so forth.

Edited October 6, 2010 by neverdie

[britmaveric]

^strong currency normally makes imports cheaper, but exports more expensive. Now saying that - prices will certainly rise on domestic goods, so in reality it prob isnt going to be good for the average thai since most likely their salaries won't rise with it.

[marquess]

^strong currency normally makes imports cheaper, but exports more expensive. Now saying that - prices will certainly rise on domestic goods, so in reality it prob isnt going to be good for the average thai since most likely their salaries won't rise with it.

I have noticed last weekend in Top that a few imported items had come down in price, along with Villa Market too!

[chantorn]

I believe most Thai people does not like the Thai currency to strengthen. maybe Thai baht should gradually depreciate until 100 baht / US dollar, and people in Thailand can than start celebrating.

[neverdie]

I believe most Thai people does not like the Thai currency to strengthen. maybe Thai baht should gradually depreciate until 100 baht / US dollar, and people in Thailand can than start celebrating.

I think you are beling silly chantorn. That would be really bad for the Thai people, 100 baht to buy a USD.

There is something called BALANCE & another thing called EQUALIBRIUM, you know?

Of course imagine the influx of tourists if the Thai baht was that weak, it would be like spot a thai around here.

[britmaveric]

^I'd agree 100bht per $ - any foreign goods would never be bought. Prob good around 35-40 range if the truth be known.

[IAMSOBAD]

I understand FX.

What I dont like is how Thai Baht gold is only 18950/19050-19100 area when gold is up to 1348.

Baht gold should be near 19600 or higher.

It was 19000 when gold was 1260 per oz.

Edited October 6, 2010 by IAMSOBAD

[neverdie]

I understand FX.

What I dont like is how Thai Baht gold is only 18950/19959 when gold is up to 1348.

Baht gold should be near 19600 or higher.

It was 19000 when gold was 1260 per oz.

Actually IAMSOBAD, if you look at GOLD verses alot of currencies, there hasnt been that much movement. Of course if you compare GOLD to USD or perhaps one or two others you will see massive moves.

So perhaps you are actually seeing the value of the USD decreasing, as opposed to the price of GOLD rising?

[Loz]

This will be an interesting week in the money markets...

Ring side seats!!

[IAMSOBAD]

I bought in very heavily around 12,400 per Thai baht gold so at 19,000 I am not complaining. But like I said it was at 19,000 when it was $1/33 baht...and gold was way below todays price.

[neverdie]

I bought in very heavily around 12,400 per Thai baht gold so at 19,000 I am not complaining. But like I said it was at 19,000 when it was $1/33 baht...and gold was way below todays price.

Yeah well you know that amazing American administration that was voted in a couple of years ago, well they havent finished milking the Americans of their wealth yet, the deception continues and my guess is this 'reset' is going to take a little while to reveals itself in all its ugliness.

[passon]

I bought in very heavily around 12,400 per Thai baht gold so at 19,000 I am not complaining. But like I said it was at 19,000 when it was $1/33 baht...and gold was way below todays price.

Yeah well you know that amazing American administration that was voted in a couple of years ago, well they havent finished milking the Americans of their wealth yet, the deception continues and my guess is this 'reset' is going to take a little while to reveals itself in all its ugliness.

What I find amazing is your conjecture to blame the Obama Administration for the failures of the Bush Administration; President Bush robbed America of its wealth long before President Obama was even a candidate for office, so if you want to link Americas financial crisis to the appreciation of the baht against the US dollar, then let's get to the heart of the real deception, which were the failed policies of George W. Bush with his propaganda war in Iraq that has cost America billions in IOUS to the Chinese government, as well as his failure to reign in the excesses of Wall Street with its international ponzi schemes that cost the American taxpayers billions more in TARP and TLGP (rescue) funding which led to the biggest financial crisis in America and around the world since the Great Depression; his generous tax breaks for the rich, and job losses under his two terms in office that were the worst on record since World War II. The ugliness, as you like to frame it comes from anyone who has the unmitigated gall to blame the guy who is attempting to extinguish the fire as the arsonist who started it; but true to the talking points of the republican party, deny the truth and embrace the lie.

[basjke]

I understand FX.

What I dont like is how Thai Baht gold is only 18950/19050-19100 area when gold is up to 1348.

Baht gold should be near 19600 or higher.

It was 19000 when gold was 1260 per oz.

Sorry but I think you don't understand FX at all.

Let's make a simple calculation.

1260$ per oz when the baht was at 32 to the dollar makes = 40320 Baht for an oz

1348$ per oz while the baht is now at 29.80 agianst the dollar makes = 40170 Baht for an oz.

[IAMSOBAD]

Basjke I understand that clearly. But according to the Thai Gold people they buy and sell Thai Baht gold with baht. Not with dollars. So their gold market seems manipulated.

[neverdie]

I bought in very heavily around 12,400 per Thai baht gold so at 19,000 I am not complaining. But like I said it was at 19,000 when it was $1/33 baht...and gold was way below todays price.

Yeah well you know that amazing American administration that was voted in a couple of years ago, well they havent finished milking the Americans of their wealth yet, the deception continues and my guess is this 'reset' is going to take a little while to reveals itself in all its ugliness.

What I find amazing is your conjecture to blame the Obama Administration for the failures of the Bush Administration; President Bush robbed America of its wealth long before President Obama was even a candidate for office, so if you want to link Americas financial crisis to the appreciation of the baht against the US dollar, then let's get to the heart of the real deception, which were the failed policies of George W. Bush with his propaganda war in Iraq that has cost America billions in IOUS to the Chinese government, as well as his failure to reign in the excesses of Wall Street with its international ponzi schemes that cost the American taxpayers billions more in TARP and TLGP (rescue) funding which led to the biggest financial crisis in America and around the world since the Great Depression; his generous tax breaks for the rich, and job losses under his two terms in office that were the worst on record since World War II. The ugliness, as you like to frame it comes from anyone who has the unmitigated gall to blame the guy who is attempting to extinguish the fire as the arsonist who started it; but true to the talking points of the republican party, deny the truth and embrace the lie.

Ohh no, I was trying to be brief, I know Obama is only continuing the good work of his idiot predecessor, I was just trying to be brief.

[IAMSOBAD]

They deal in baht gold not oz gold. Its less gold and more alloy metal. Current price is 18050/19050 per baht gold.

[basjke]

Basjke I understand that clearly. But according to the Thai Gold people they buy and sell Thai Baht gold with baht. Not with dollars. So their gold market seems manipulated.

Sorry but you can't be that dumb,can you.Why you don't ask those people where in Thailand that goldmine is located.

Gold has only one price worldwide and that is calculated in US$.Same as oil is calculated in US$ worldwide.

Edited October 6, 2010 by basjke

[britmaveric]

No worries I have a feeling with yank elections leaning towards fiscal conservative policies I dare say a strong $ will return. Expect a bump after the elections.

[passon]

No worries I have a feeling with yank elections leaning towards fiscal conservative policies I dare say a strong $ will return. Expect a bump after the elections.

Fiscal conservative policies is what got America into the mess it's in today, so what your saying is that the guys who robbed the bank should now be rehired to guard it. Realizing of course the bank no longer has any money in it to guard, that "bump after the elections" you are referring to, if the republicans win a majority in November (which is not necessarily a slam/dunk) will be the sound of the American economy crashing under the weight of fiscal mismanagement and corporate (special) interest. I'm not doing handstands with the policies of President Obama, but a republican majority is clearly not the solution, and a lot of Americans are beginning to sober up to that fact.

[IAMSOBAD]

Baht has gone from 32 to 30 per dollar and gold has gone up over 88 dollars an oz since the last time baht gold was 19000. It just seems it should be higher.

[Hawaiian]

There is not doubt the financial crisis has hurt the American taxpayer. However, TARP was a necessary evil.

When the final tally is made the bottom line will be a worthwhile investment, Most of it will be paid back with

interest. Interest paid and profit on stock sold will more than cover any monies not paid back.

Although the Bush administration caused a lot of damage, Obama and company's runaway spending is leading to a spiraling deficit that will eventually lead to a financial crisis far worse than most Americans realize possible.

I not talking about politics, but the urgent need for sound fiscal and monetary policies. Sooner or later the printing presses will run out of ink.

[mommysboy]

The exchange rate is primarily about the weakness of the dollar, but the baht is rather strong.

The dollar weakness is because it has such a deficit, awful private and public debt, low interest rates, and may be set for a further round of money printing. As the 'reserve currency' it also escaped the massive devaluations smaller currencies underwent.

Let's not underestimate the effect of hot money too- this is money that pours in on a short term basis and possibly dissipates just as quickly, artful parties can do a lot of damage, and right now there is no incentive for countries like USA, and USA satellite to play fair.

It is not inconceivable that it could drop further, and what exactly are the grounds for predictions of short term recovery?

Further, devaluation is a very shrewd weapon against countries like Thailand, it kills the game off!

Not good for us expats though.

[el jefe]

Baht has gone from 32 to 30 per dollar and gold has gone up over 88 dollars an oz since the last time baht gold was 19000. It just seems it should be higher.

In the unlikely event that your math is correct it should be pretty easy to profit off the spread by going long baht gold and shorting gold in dollars until the gold prices equal out.

[rustydick]

only a couple yrs ago it was 67 to the pound .thailand got more expensive to drink stay eat and travel to never mind the pound on its knees to the bath.

[kmj]

only a couple yrs ago it was 67 to the pound .thailand got more expensive to drink stay eat and travel to never mind the pound on its knees to the bath.

No it didn't things are still the same price in baht as a couple of years ago ( gasoline is cheaper now ) it only matters if you are bringing money into the country as in pension, holiday etc, I get paid in baht it only makes a difference to me when I send money out ( which at the moment is great ) go baht I say ( sorry I know selfish )

[Colabamumbai]

I am not a financial expert on FX, so can someone tell me whether the Thai baht has strengthened against the U.S.$ or has the U.S.$ weakened against the baht.

As a Canadian, my CAD is worth around 29.5+- and the AUD is also up over 29 to the THB.

So should the headline read U.S.$ weakens against THB?

Thanks. :jap:

From a fellow Canadian, the Thai Bhat has strengthened against all currencies, which means we get less for our dollar, when it has weakened we will see the rate go back up to 30 Bhat plus per dollar. (less confidence in dollars, more confidence in bhat.) is the cause.