How Much The Thai Bath Loose Value,within The Last 3 Years?

[Sandman77]

Hello!

i only read reports on the internet,that the € use 30% value against other currencys!

but i still dont know,how much value the thai bath loose ,in the same time period the last 3 years,since world economic crisis!

how the $ is now connected to the bath ,or isnt?

who can explain this?

thanks !

[bkkjames]

it has gone up.

[endure]

I shouldn't imagine a 3 year old bath would be worth much at all...

[chainarong]

How long is a piece of string?

[chiang mai]

The Pound and the US Dollar have lost over 30% against the Thai Baht hence the Thai Baht has gained! The Thai Baht is also loosely pegged to USD on a short timescale basis although this is movable.

[PattayaPhom]

Ask an Aussie and they will say Baht has lost 50%, ask a Brit and they will say Baht has lost 10%, ask a Yank and they will say Baht is stronger, ask any Euro country they will say Baht is stronger.....but is it really?

[ThaidDown]

Of course if the plug is not fitted correctly the level of the bath will go down .

For info some currencies from Bangkok Bank 3 years ago compared with today (08:30)

[chiang mai]

Of course if the plug is not fitted correctly the level of the bath will go down .

For info some currencies from Bangkok Bank 3 years ago compared with today (08:30)

Remarkably close actually, given that it is three years ago, perhaps if you would have gone five years prior you would have seen a serious disparity between then and now. But actually, those figures hide the fact that presently THB seems to be weakening, ever so slightly.

[puck2]

Remarkably close actually, given that it is three years ago, perhaps if you would have gone five years prior you would have seen a serious disparity between then and now. But actually, those figures hide the fact that presently THB seems to be weakening, ever so slightly.

And today, the VISA-rate gives you more than 50 THB for 1 GDP - except fees.

Edited September 28, 2012 by puck2

[billd766]

Using the KBank exchange rates against the UK pound I have attached from 2000 to 2005, 2006 to 2010, 2011.

It won't let me load 2012 for some reason.

5 year trend 2000 to 2004.xls

5 year trend 2005 to 2010.xls

5 year trend 2011 to 2015.xls

Forex 2011 v1.xls

Edited September 28, 2012 by billd766

[asiawatcher]

From my earlier days here. GBP was 72 Baht to the Pound, USD was 37, Euro was around 50 and the Aussie dollar was 22. Aussie has been the performer at now about 31 Baht to the AUD. But the Baht, in spite of itself, has been held up. The Yanks have been printing money as has the European Banks so I don't put any faith in either currency. The pound seems to hold up a bit but the Baht has remained in the game - possibly to the buoyancy of Asia in general. I do think the next 6-12 months will see USD come back a bit, the British pound slump and the Euro all but go down. China also now not good as far as Asia is concerned. If the Thai's could stalemate the corruption it could actually remain a sound currency but don't tell the Thai's... Just my opinion

[fletchsmile]

.... The Thai Baht is also loosely pegged to USD on a short timescale basis although this is movable.

More accurately:

Since July 1997, Thailand has adopted the managed-float exchange rate regime, which is also consistent with the inflation targeting regime that has been in place since 2000. Under the inflation targeting framework and the managed-float, the value of the baht is allowed to be determined by market forces, reflecting demand and supply for the baht in the foreign exchange market.

Under the managed float, the Bank of Thailand (1) does not target a fixed level for the exchange rate, (2) stands ready to intervene in the case of excess volatility, particularly resulting from speculative capital flows, in a manner consistent with the Bank’s inflation targeting framework.

In some instances, however, supply and demand may be at a disequilibrium, leading to excessive volatility in the value of the baht. The Bank of Thailand aims to ensure that the value of the baht is allowed to fluctuate under the following conditions; (1) the Bank of Thailand stands ready to intervene in the foreign exchange market such that volatility of the exchange rate is at a level that the economy can tolerate, (2) maintaining national competitiveness, as measured through the Nominal Effective Exchange Rate (NEER), which comprises currencies of important trading partners - and not just the US Dollar, and (3) any intervention does not go against economic fundamentals which would otherwise lead to further imbalances.

[source BOT website on Monetary Policy and Exchange rates]

[Huayrat]

3 years ago at this date i moved here and the baht was 48 to my pound im now getting 49.5 so i guess the pound has improved..

[chiang mai]

.... The Thai Baht is also loosely pegged to USD on a short timescale basis although this is movable.

More accurately:

Since July 1997, Thailand has adopted the managed-float exchange rate regime, which is also consistent with the inflation targeting regime that has been in place since 2000. Under the inflation targeting framework and the managed-float, the value of the baht is allowed to be determined by market forces, reflecting demand and supply for the baht in the foreign exchange market.

Under the managed float, the Bank of Thailand (1) does not target a fixed level for the exchange rate, (2) stands ready to intervene in the case of excess volatility, particularly resulting from speculative capital flows, in a manner consistent with the Bank’s inflation targeting framework.

In some instances, however, supply and demand may be at a disequilibrium, leading to excessive volatility in the value of the baht. The Bank of Thailand aims to ensure that the value of the baht is allowed to fluctuate under the following conditions; (1) the Bank of Thailand stands ready to intervene in the foreign exchange market such that volatility of the exchange rate is at a level that the economy can tolerate, (2) maintaining national competitiveness, as measured through the Nominal Effective Exchange Rate (NEER), which comprises currencies of important trading partners - and not just the US Dollar, and (3) any intervention does not go against economic fundamentals which would otherwise lead to further imbalances.

[source BOT website on Monetary Policy and Exchange rates]

Reading that FS I think we're broadly saying the same thing, it isn't pegged but it is, who says you can't have the best of both worlds! And this was brought home to me yet again this week when I went to move some GBP into THB and the transaction found itself incomplete on a Monday morning as BOT "adjusts" the "volatitility peg". The Tuesday thru Thursday rate would have been circa 49.9 but the Monday adjustment on onday morning pushed it down to 49.5, luckily the bank caved in to pressure but that weekly correction is now a standard feature.

[yoshiwara]

.... The Thai Baht is also loosely pegged to USD on a short timescale basis although this is movable.

More accurately:

Since July 1997, Thailand has adopted the managed-float exchange rate regime, which is also consistent with the inflation targeting regime that has been in place since 2000. Under the inflation targeting framework and the managed-float, the value of the baht is allowed to be determined by market forces, reflecting demand and supply for the baht in the foreign exchange market.

Under the managed float, the Bank of Thailand (1) does not target a fixed level for the exchange rate, (2) stands ready to intervene in the case of excess volatility, particularly resulting from speculative capital flows, in a manner consistent with the Bank’s inflation targeting framework.

In some instances, however, supply and demand may be at a disequilibrium, leading to excessive volatility in the value of the baht. The Bank of Thailand aims to ensure that the value of the baht is allowed to fluctuate under the following conditions; (1) the Bank of Thailand stands ready to intervene in the foreign exchange market such that volatility of the exchange rate is at a level that the economy can tolerate, (2) maintaining national competitiveness, as measured through the Nominal Effective Exchange Rate (NEER), which comprises currencies of important trading partners - and not just the US Dollar, and (3) any intervention does not go against economic fundamentals which would otherwise lead to further imbalances.

[source BOT website on Monetary Policy and Exchange rates]

Reading that FS I think we're broadly saying the same thing, it isn't pegged but it is, who says you can't have the best of both worlds! And this was brought home to me yet again this week when I went to move some GBP into THB and the transaction found itself incomplete on a Monday morning as BOT "adjusts" the "volatitility peg". The Tuesday thru Thursday rate would have been circa 49.9 but the Monday adjustment on onday morning pushed it down to 49.5, luckily the bank caved in to pressure but that weekly correction is now a standard feature.

There is a difference between a hard link: HKD:USD, a publicly managed peg: CHF:EUR, and what the BOT describe as a 'managed exchange rate', which is not a peg, but rather an attempt to manage volatility (don't they all).

[chiang mai]

A part of me wants to ask what the real world difference is between a publicly managed peg and a managed exchange rate, however I fear this is one of those, "ängels on pins" issues hence I will not! Using the word "peg" in the context of exchange rates is always going to be controversial, no matter how heavily the word is prefixed.

Edited September 29, 2012 by chiang mai

[bushwacker]

Much to do about nothing ....

[chiang mai]

Much to do about nothing ....

It's much ado, not to do.

Edited September 29, 2012 by chiang mai

[yoshiwara]

The HKD:USD is set in stone. The more recent CHF:EUR of 1:1.20 is a line publicly drawn and with the firepower to defend from the SNB.

The Thai baht is more of a 'desirable' range but as they learned in 1997, difficult to manage if the heat is on, so more like a crawling peg in effect.

[chiang mai]

The HKD:USD is set in stone. The more recent CHF:EUR of 1:1.20 is a line publicly drawn and with the firepower to defend from the SNB.

The Thai baht is more of a 'desirable' range but as they learned in 1997, difficult to manage if the heat is on, so more like a crawling peg in effect.

Thanks, so a sort of a loose peg rather than a firm peg?

[yoshiwara]

The HKD:USD is set in stone. The more recent CHF:EUR of 1:1.20 is a line publicly drawn and with the firepower to defend from the SNB.

The Thai baht is more of a 'desirable' range but as they learned in 1997, difficult to manage if the heat is on, so more like a crawling peg in effect.

Thanks, so a sort of a loose peg rather than a firm peg?

I would buy that if we had a target to aim at, but Thailand is quite rightly somewhat coy at publishing targets. All central banks enter the FX markets at some time or other and it appears (from comments made) that Thailand is more wanting to smooth volatility rather than defend a price.

[fletchsmile]

The HKD:USD is set in stone. The more recent CHF:EUR of 1:1.20 is a line publicly drawn and with the firepower to defend from the SNB.

The Thai baht is more of a 'desirable' range but as they learned in 1997, difficult to manage if the heat is on, so more like a crawling peg in effect.

Thanks, so a sort of a loose peg rather than a firm peg?

No, it's not a peg. It's as it says. In addition it is managed vs a range of currencies (including other SE Asia currencies), and not just USD

...(2) maintaining national competitiveness, as measured through the Nominal Effective Exchange Rate (NEER), which comprises currencies of important trading partners - and not just the US Dollar,...

Edited September 29, 2012 by fletchsmile

[chiang mai]

Another, big sigh!

[Suradit69]

The Pound and the US Dollar have lost over 30% against the Thai Baht hence the Thai Baht has gained! The Thai Baht is also loosely pegged to USD on a short timescale basis although this is movable.

It would probably be more meaningful to think it terms of what 100 baht would buy three years ago compared to the cost of those same things today. The baht may be sinking more slowly than the dollar or Euro, but most fiat currencies have lost value against gold or oil or consumer necessities.

Edited September 30, 2012 by Suradit69

[Rimmer]

Off topic lame attempt at humour removed

[billd766]

The Pound and the US Dollar have lost over 30% against the Thai Baht hence the Thai Baht has gained! The Thai Baht is also loosely pegged to USD on a short timescale basis although this is movable.

It would probably be more meaningful to think it terms of what 100 baht would buy three years ago compared to the cost of those same things today. The baht may be sinking more slowly than the dollar or Euro, but most fiat currencies have lost value against gold or oil or consumer necessities.

11 years ago when I bought my pickup truck the GBP was about 65 baht and diesel was less than 10 baht/litre if you want to use that as an example.

Edited September 30, 2012 by billd766

[fletchsmile]

Another, big sigh!

You might want to look up some of the economic terminology, while there are some similarities between what you're saying there are also some key differences. Wiki offers some reasonable definitions.

http://en.wikipedia.org/wiki/Exchange-rate_flexibility

Summing up: BOT have a flexible exchange rate system rather than fixed (such as fixed rate peg). Of the flexible rate systems that they could employ, BOT's policy is not a crawling peg or managed within bands or ranges. This is why I wouldn't describe BOT's system as any form of peg. At the other end of the fixed/flexible spectrum it is not a pure float either as BOT can and does intervene. "Managed float" is the most accurate definition of what the policy is and how they operate in practice.