Evolution Of The Baht Compared To Euro

[exbelg]

hi there fellow users

how do you think about the evolution of the baht the next comming months

you think it will weaken compared to other currencies ?

I specially would like to see the Euro gain some strength against the Baht, but is this possible with all the economic turmoil ?

[Mobi]

If I could forecast movements in the world exchange rate I would be a very rich man - but I'm not.

So bear this in mind when I tell you that all the economic indicators point to the Baht strengthening against the Euro, GBP and the USD over the coming months - maybe 5-10%.

I hope I am wrong, but fear that I'm not....

[hgma]

In developing countrys there is a "compansation for inflation"

Not down here.

I realy do plea for the Thai Immigration department to set guidelines for fixed exchangerates in relation to obtain a visa.

euro for excample 45.

dollar 30

pound 55

doesnt sound so "bath" if one considers the average rates of these currencies over the last 5 years.

The question is does Thailand realy want to join the "developing countries"

hgma

If I could forecast movements in the world exchange rate I would be a very rich man - but I'm not.

So bear this in mind when I tell you that all the economic indicators point to the Baht strengthening against the Euro, GBP and the USD over the coming months - maybe 5-10%.

I hope I am wrong, but fear that I'm not....

[jamora]

It depends on a lot of factors.

The Eurozone still seems to be recovering, and the uncertainties caused by Portugal, Spain, Greece and Ireland look limited (for now!!!), so I doubt that you will see any major slowdown in the Eurozone.

Thailand, on the other hand, is a some what different situation. If you look at the inflow of foreign capital, you will see that it has slowed down somewhat over the last few months (which is exactly what the government tried to achieve in november I believe). The Thai economy have; however, been strong due to good domestic consumption and investment, which could be seen on the development of the SET in the last few months of 2010.

But now they are facing some great uncertainties. The biggest is inflation! It was only a week ago that the BOT adjusted the core inflation report to 2.8-3.8%, but they maintained their growth figures at 3.5-5.5%. These inflation numbers are quite high, and considering that the interest rate has to be higher than the inflation, we can expect to se quite an increase in the interest rate over the next quarters. This will cause the domestic consumption to slow down, and eventually the whole economy. Then they could seek to attract foreign investors, but with the domestic political turmoil and the conflict with Cambodia, it might not be as easy as it used to be! At the same time, IMF have forecasted Thailand to be the slowest growing economy in the region, so foreign investors might as well look at Malaysia, Vietnam and Indonesia, where growth is expected to be higher, but without the political issues.

A last thing to take into consideration is the domestic conflicts in the Middle East. If they were to spread to countries like Saudi Arabia, Kuwait etc. it could make the price on crude oil rocket, and eventually headline inflation, which would be worse for the Thai economy.

To sum it all up, I believe that the Thai baht will either fluctuate around its present level, or perhaps make a minor dip! I don't think we will see any major appreciation in the near future. If they manage to control their political issues, and the Middle East won't burn, then I think they will stay where they are! If not... Who really knows?

Please ad that this is my own prediction, and it is not much better than what anyone else could do!

Edited February 22, 2011 by jamora