GBP to THB Exchange Rate

[BlackPuddingBertha]

What puts me off having more than 10% of my wealth in Thailand/THB (even though this still amounts to only about 10 years average annual expenditure)?

1) I have a long visa which is easily extended every year, but I have no right of abode here. They could chuck me out tomorrow and I could do nothing about it. The same applies to all farangs here, of course, except perhaps those rare birds who have PR (and I'm not sure that this cant be revoked).

2) The THB only really has any value inside Thailand and in international terms the value appears to be managed rather than floating (for better or worse).

3) I'm not sure that I will want to still be here in 2/5/whatever years.

4) I get a better return on my investments in the UK than I could here, and those investments probably carry less risk.

[fletchsmile]

Thanks a lot for your thoughts. If I may ask, what's your opinion on getting into gold? I'm looking to exit GBP as soon as possible and was wondering if that would be a good destination for it. Otherwise, even at 47 Baht to the GBP I might have to buy THB now given yours and others' forecasts.

I've never been a big fan of gold. That said, in the last few years I've put some money into gold ETF funds simply to diversify a bit. I don't want more than about 5% in gold though. For me I find it hard to come up with values for gold based on fundamentals, and I much prefer equities over the long run. It's not without risk, as there's a massive amount of money been put in there in recent years by people looking for a safe haven or diversifying etc. Once economies start picking up, problems sorting out etc it could move rapidly down. No idea really whether it will move to 1500, 1800 and above or do very little (as in 2012). I just hold some to diversify.

On currencies I think GBP/THB will fluctuate so you may get a chance for better rates than the current 47 along the way, just I think the generally trend is towards 45. It's unlikely to be a straight line down. For me if living in Thailand I think makes sense to build THB assets. I'd do that gradually over time though rather than large jumps. In your shoes I'd probably convert some now, and wait a while to see if an opportunity presents itself at a a better level..

[fletchsmile]

What puts me off having more than 10% of my wealth in Thailand/THB (even though this still amounts to only about 10 years average annual expenditure)?

1) I have a long visa which is easily extended every year, but I have no right of abode here. They could chuck me out tomorrow and I could do nothing about it. The same applies to all farangs here, of course, except perhaps those rare birds who have PR (and I'm not sure that this cant be revoked).

2) The THB only really has any value inside Thailand and in international terms the value appears to be managed rather than floating (for better or worse).

3) I'm not sure that I will want to still be here in 2/5/whatever years.

4) I get a better return on my investments in the UK than I could here, and those investments probably carry less risk.

On the 10% you know yourself and situation best. Also depends on your situation and a lot of other factors. I also have a Thai wife and children.

On your points:

1) I hear you on that. On the other hand unless you're a criminal or done something very untoward, it's unlikely you'd get deported with no notice. More realistic is you'd struggle for some reason on a long term visa. Our illiquid assets (condo) are in the wife's name. The liquid assets, eg unit trusts and cash are in a combination of mine/hers/joint and kids. For unit trusts would talk about a week to liquidate and get access to cash, that's easily done on just a 30 day entry

2) THB isn't a managed currency. BOT are quite clear on the website about the policy. Having worked in banking in Thailand for a few years, with contact to BOT and access to various financial data I think their policy is pretty accurate.

3) Very good point. Also a good reason to hold money in the currency where you come from as well as other currencies

4) You've done better than me on UK investments then. Last decade or so Thailand investments have done very well for me, and UK mediocre. That's one reason my THB weighting is higher now than it's ever been - very strong relative performance here in recent years compared to the west. You also need to factor in the currency element as the thread raises. GBP and other western currencies have lost around 30% vs THB in last 5 years, so people need to factor that in

[reflectionx]

My view is USD/THB will push towards 29. GBP will weaken vs USD and I wouldn't be surprised to see it push towards 1.50. With that in mind don't be surprised to see GBP/THB pushing towards 45. There'll of course be ups and downs along the way, but I see more chance of GBP/THB at 45 than GBP/THB 50.

From a macro picture US and UK are in far worse shape than Thailand in terms of their economies, particularly relative to where they come from. They're going thru much tougher times than Thailand.

Examples: UK and US both have indulged in QE and increasing their money supplies. Both low interest rates look set to continue = unattractive currency. Both have(or had) their sovereign credit ratings under pressure. Both running large deficits. Both high debt to GDP levels etc etc. Both no or anemic growth. All these are negatives relative to where they are, and historically where they've come from. Relatively Thailand is better placed.

US seems a bit better placed than UK, and further along the curve - already downgraded, looks like small growth ahead, plus it's still looked at as the world's reserve currency - even if that's changing slowly.

Summed up US in a bad place, UK worse. Thailand doing relatively nicely.

Historically I used to aim to keep one third of my assets in GBP (where I was), one third in THB (where "I am"), and one third in other currencies. For various reasons (currency appreciation, strong investment returns, previously earning in THB etc) my THB exposure has moved to over 50%, and GBP and other currencies dropped.

I'm not overly uncomfortable with this. The way the world is at the moment, and given Thailand is our home now. I'm mindful of reducing my allocation to THB to more like 40%, when timing is right, as shocks always happen, but not into GBP and US at the moment.

Thanks a lot for your thoughts. If I may ask, what's your opinion on getting into gold? I'm looking to exit GBP as soon as possible and was wondering if that would be a good destination for it. Otherwise, even at 47 Baht to the GBP I might have to buy THB now given yours and others' forecasts.

I would wait, Thailand relies heavily on foreign investments, which are attracted by cheap labor and cheap baht. Strong currency would push investors elsewhere. That's the reason why China does not let their currency appreciate (and the reason why US is not a happy camper ).

It's been always the safest to spread your cash in a basket of currencies (consider some % going to currency in resource rich countries, like Canadian dollar) - can't gain, but can't lose either.

Keep in mind that in general news for stronger US economy = rising appetite for risky investments = investors selling US$ to invest in stocks and other currencies = US$ going down and other currencies going up = stocks going up

[fletchsmile]

Sterling's "cliff fall" versus Thai Baht started already in 2004.

There's nothing like a good graph to prove .... anything you want.

The THB was 48 to the GBP in 1973 also.

To me the 1973 onwards graph just reinforces the idea THB will strengthen vs GBP. Prior to the Asian Crisis in 1997 THB continued to strengthen. The Asian Crisis hit and there was a massive shift. Not a trend BTW - a shift. After that it took Asia a while to get its house in order again, which Thailand has done compared to the west. Then the downward trend continued. Accelerated by the Western economic crisis. Won't be long before it has reconnected and simply continuing where it left off in 1997.

Someone will pipe up that prior to 1997 the rate was not a market float but manipulated and fixed. While true, a country can't indefinitely maintain its currency at artificial levels, so while it was indeed manipulated, the overall trend of GBP weakening and THB strengthening was valid in my view. Similar arguments now exist, Thailand developing and growing at better rates than UK - a developed market. the difference is this time round Thailand is on a much more solid footing, having restructured many of the key factors like banking system which are more robust.

Edited January 19, 2013 by fletchsmile

[exeter]

In a years time the Asean will underwayand how will that affect things? I suspect that the countries involved have their own thoughts on how it will benefit them but I wonder if they have thought about what benefits one country might benefit another.

I can never understand why vehicles here are so expensive, compared to European cars they are more expensive and not as well specified, no one here wants to buy a second hand car ( from my obervations ) yet the prices seem to be not far off new ones, understandable then. So there are lots of 2nd hand cars with one looking to buy. In under a year's time a new trading block and possibly an influx of cars from neighbouring Asean countries to play havoc with the cosy little arrangements in Thailand, now will that affect the currently rising bhat, good news for us with the exchange rate perhaps or maybe as well a colapsing car market? Anyone for a bargain chaps?

[BlackPuddingBertha]

I can never understand why vehicles here are so expensive, compared to European cars they are more expensive and not as well specified,...

Not just cars. Most things that come out of a factory seem to cost more here than they would do in Europe. Even my regular supermarket shopping bill for locally-made or locally-produced items costs me more here than it would in Europe, and I dont include fancy imported items like cheese and wine.

To me all this just indicates that the Baht is way overvalued.

[Naam]

I can never understand why vehicles here are so expensive, compared to European cars they are more expensive and not as well specified...

different countries have different prices for most products because different customs/excise duties and VAT apply.

go to Europe and find out that a German car produced in Germany has a much lower price in several EU countries than in Germany. go to Switzerland or Japan and weep when you pay for a meal in some sh*tty fast food chain like McDonalds, BurgerKing or Pizza Hut.

the same applies to services. compare the charges of a working girl in Dhaka, Bangla Desh with the charges of a working girl in Oslo, Norway or Stockholm, Sweden.

[Naam]

I can never understand why vehicles here are so expensive, compared to European cars they are more expensive and not as well specified,...

Not just cars. Most things that come out of a factory seem to cost more here than they would do in Europe. Even my regular supermarket shopping bill for locally-made or locally-produced items costs me more here than it would in Europe, and I dont include fancy imported items like cheese and wine.

To me all this just indicates that the Baht is way overvalued.

that the Baht is overvalued goes without saying. dozen of threads and a zillion postings of Thaivisa economic experts agree with you and forecast a big devalution of THB vs. all currencies.

p.s. that's what the resident experts are forecasting since six years.

[billd766]

It is an odd thing but I rarely read about people who forecast currencies to go up or down being millionaires.

If I had the money to speculate and was also smart or lucky enough I wouldn't tell anybody what I was doing, win or lose.

I first came here in 1993 when the GBP/THB was around 44, I saw it go close to 100 in 1997/98 and I saw it go slowly down to around 2005/06 when it went down a bit quicker.

This is what I have gathered over the years from the Kasikorn bang using their TT rates.

5 year trend 2000 to 2004.xls

5 year trend 2005 to 2010.xls

Forex 2011 v1.xls

For some reason the system won't let me upload 2012.

Forex 2013 v1.xls

[15Peter20]

I can never understand why vehicles here are so expensive, compared to European cars they are more expensive and not as well specified,...

Not just cars. Most things that come out of a factory seem to cost more here than they would do in Europe. Even my regular supermarket shopping bill for locally-made or locally-produced items costs me more here than it would in Europe, and I dont include fancy imported items like cheese and wine.

To me all this just indicates that the Baht is way overvalued.

that the Baht is overvalued goes without saying. dozen of threads and a zillion postings of Thaivisa economic experts agree with you and forecast a big devalution of THB vs. all currencies.

p.s. that's what the resident experts are forecasting since six years.

I presume you're being sarcastic. Next week I think I'll just have to bite the bullet and change a sizeable chunk of GBP to TBH. Most seem to suggest that in a couple of years we may be dreaming about being able to get the rate as it is today, despite the losses we've seen over the past few weeks.

[Naam]

I presume you're being sarcastic. Next week I think I'll just have to bite the bullet and change a sizeable chunk of GBP to TBH. Most seem to suggest that in a couple of years we may be dreaming about being able to get the rate as it is today, despite the losses we've seen over the past few weeks.

yes i am sarcastic Peter but i posted nothing but the truth as far as the wishful thinking and wet dreams of some people are concerned. but that does not mean that i am able to make any forecast on currencies. being a seasoned investor with an experience of several decades i wouldn't dare to make a forecast what will happen next week on the currency markets. i'd be more qualified to do some weather forecasting for the next few days and with a little luck my forecast might be correct.

[mccw]

When making a sizeable transfer do you think it's better to use something like Moneycorp so the rate is fixed / agreed on day of transfer? (can also target rates if got time to wait). But their advertised rate is almost 1 bht worse than the Thai bank rate. However when send normally TY in pounds and changed by the Thai bank a couple of days later, as we've just seen, the rate can move dramatically and the bank will undoubtably give the lowest rate possible on the day. I just got hit from this lost about 32k bht from what I was expecting. I have some more and bigger transfers to make coming up. No urgency, but I'm erring on the side of just getting on with it before the £ gets a beating. Like to time it around 48-49. So stick with the standard TT transfer way accepting this recent big daily drop as an anomaly or fix the rate even if a little lower?

[reflectionx]

When making a sizeable transfer do you think it's better to use something like Moneycorp so the rate is fixed / agreed on day of transfer? (can also target rates if got time to wait). But their advertised rate is almost 1 bht worse than the Thai bank rate. However when send normally TY in pounds and changed by the Thai bank a couple of days later, as we've just seen, the rate can move dramatically and the bank will undoubtably give the lowest rate possible on the day. I just got hit from this lost about 32k bht from what I was expecting. I have some more and bigger transfers to make coming up. No urgency, but I'm erring on the side of just getting on with it before the £ gets a beating. Like to time it around 48-49. So stick with the standard TT transfer way accepting this recent big daily drop as an anomaly or fix the rate even if a little lower?

You can use XE.com. They let you lock rate now and transfer in the future, have "auto-lock" rates (if the rate reaches some specified by you threshold). Can transfer by wire to someone else's account. The sign up process is a bit of pain due to money laundering laws, but it's useful if you do lots of transactions.

[Naam]

i'm not sure how other Thai banks are handling the matter but when i make a sizeable transfer i get a call from SBC, BKK and an offered rate. i can accept, haggle a bit (which i do most of the time) or postpone the conversion up to four weeks and call them during this period when i think the rate is favourable. if i accept i am also told "amount is available at xx.oo hours today afternoon".

p.s. i have never used the "delay" option.

[BlackPuddingBertha]

yes i am sarcastic Peter but i posted nothing but the truth as far as the wishful thinking and wet dreams of some people are concerned.

Wet dreams and sarcasm have nothing to do with it. It is a simple fact that many items (even items that are made/produced here) cost more here than they do in Europe, in spite of VAT being much higher there than there and in spite of wages and associated costs being much lower here than there. On the other hand, if you compare US and European prices, the difference in prices does follow the different tax and labour costs which makes sense. The same applies in Japan and is also reflected in prices in different European countries. All of which makes perfect sense to me.

But not here.

To me this indicates that there is something funny going on here. Whether the value of the Baht goes up or down or stays the same is not relevant to the question, nor do I care to guess about what it might do. I'm just interested in why many prices are skew-whiff here, and to me an overvalued Baht seems a likely culprit. I have had personal experience of exactly the same effect in parts of Africa and an artificially overvalued local currency was the reason there also.

[mccw]

When making a sizeable transfer do you think it's better to use something like Moneycorp so the rate is fixed / agreed on day of transfer? (can also target rates if got time to wait). But their advertised rate is almost 1 bht worse than the Thai bank rate. However when send normally TY in pounds and changed by the Thai bank a couple of days later, as we've just seen, the rate can move dramatically and the bank will undoubtably give the lowest rate possible on the day. I just got hit from this lost about 32k bht from what I was expecting. I have some more and bigger transfers to make coming up. No urgency, but I'm erring on the side of just getting on with it before the £ gets a beating. Like to time it around 48-49. So stick with the standard TT transfer way accepting this recent big daily drop as an anomaly or fix the rate even if a little lower?

You can use XE.com. They let you lock rate now and transfer in the future, have "auto-lock" rates (if the rate reaches some specified by you threshold). Can transfer by wire to someone else's account. The sign up process is a bit of pain due to money laundering laws, but it's useful if you do lots of transactions.

I assume XE would have same problem as Moneycorp; ie they must use the international rate rather than the better rate available with in Thailand.

[exeter]

The point I was trying to make was that in a years time Thailand might have a bit more competion from its newly formed little club and that might force prices down if new imports look like a good buy against home grown stuff and if they are not selling their home grown stuff then they will have to export, but not at the current prices, so maybe the bhat will be helped down the ladder?

[mccw]

i'm not sure how other Thai banks are handling the matter but when i make a sizeable transfer i get a call from SBC, BKK and an offered rate. i can accept, haggle a bit (which i do most of the time) or postpone the conversion up to four weeks and call them during this period when i think the rate is favourable. if i accept i am also told "amount is available at xx.oo hours today afternoon".

p.s. i have never used the "delay" option.

Cheers.

I'll go in and have a word with them directly to take advantage this service. Seems the best option I think. Previously my transfers had been just been online TTs coming in automatic/ no call, just appearing in account. Always under 20K gbp at a time.

If you had a million £ to move would you split it and if so over what time period?

I tend to think the £ will weaken this year and onwards but may be able to catch a pull back closer the 50bht within the next couple of months before the real rot sets in.

The BoT has been making noises about intervention for years but done nothing. Unless PT succeeds in replacing the key BoT people with Shiniwatra stooges then the risk of £ weakening further is far more likely than meaningful action on BHT value.

[mccw]

Thailand is quite heavily dependant on foreign energy. I think the calculation has been made that its better to allow a stronger bht to buy the foreign energy and attempt to see the production adapt to more skilled value added manufacturing than purely cheap labour; this has been going on for quite some time already really. It's not as if a couple more % after the 30% already seen is going to break the camels back. Ultimately I think this policy is better for Thailand in the long run than getting caught up in the wests currency wars. Stronger bht can buy overseas companies, drilling rights, technology, machinery, food and such. Also should keep inflation lower than what it otherwise could be.

[Naam]

Cheers.

I'll go in and have a word with them directly to take advantage this service. Seems the best option I think. Previously my transfers had been just been online TTs coming in automatic/ no call, just appearing in account. Always under 20K gbp at a time.

If you had a million £ to move would you split it and if so over what time period?

I tend to think the £ will weaken this year and onwards but may be able to catch a pull back closer the 50bht within the next couple of months before the real rot sets in.

The BoT has been making noises about intervention for years but done nothing. Unless PT succeeds in replacing the key BoT people with Shiniwatra stooges then the risk of £ weakening further is far more likely than meaningful action on BHT value.

lately i am reading quite some "anal"-ysts opinions concerning a weakening Pound in the future. what i have seen is that GBP weakened indeed not only vs. a presently "strong" €UR but also a rather weak USD €UR pair. half of my career as investor i held GBP and there were years when i held exclusively GBP. today i hold a negligible £125k (a subordinated bond issued by HBOS ISIN XS0125681345) which yielded >30% p.a. when i bought it in 2009 but with more than quadrupling in price the yield is down to ~7.5% p.a. the raked in profit makes me immune vs. any potential GBP losses and of course i am not very interested in GBP's future.

[Naam]

TT rate GBP THB below 47!

[yoshiwara]

Always under 20K gbp at a time.

If you had a million £ to move would you split it and if so over what time period?

I tend to think the £ will weaken this year and onwards but may be able to catch a pull back closer the 50bht within the next couple of months before the real rot sets in.

Good luck with that wish for a 50 baht exchange rate.

The other issue to bear in mind re a longer-term position is to consider the impact on Thailand re the VIP event which looms.

I would suggest that purely from a currency exchange perspective you don't need to hold more than 3 years spending money in baht. Ok you can mark that up for emergencies, but still a lower figure than you may have been considering. For sums larger than this I would rather hold assets in HKD or SGD.

[15Peter20]

TT rate GBP THB below 47!

Maybe a sustained strengthening of the THB is just what is required to give the BOT that kick up the ass to satisfy the wet-dreamers and intervene. How's that for a bit of optimism on a Monday morning?

[Naam]

TT rate GBP THB below 47!

Maybe a sustained strengthening of the THB is just what is required to give the BOT that kick up the ass to satisfy the wet-dreamers and intervene. How's that for a bit of optimism on a Monday morning?

inspite of prolonged BoT intervention (evidence sky rocketing foreign reserves) we have a sustained and long term THB strengthening vs. major currencies which also applies now to SGD and HKD.

not a recommendation but a factual statement: "i sold early last week all my SGD denominated assets".

Edited January 21, 2013 by Naam

[mccw]

Always under 20K gbp at a time.

If you had a million £ to move would you split it and if so over what time period?

I tend to think the £ will weaken this year and onwards but may be able to catch a pull back closer the 50bht within the next couple of months before the real rot sets in.

Good luck with that wish for a 50 baht exchange rate.

The other issue to bear in mind re a longer-term position is to consider the impact on Thailand re the VIP event which looms.

I would suggest that purely from a currency exchange perspective you don't need to hold more than 3 years spending money in baht. Ok you can mark that up for emergencies, but still a lower figure than you may have been considering. For sums larger than this I would rather hold assets in HKD or SGD.

"Closer to 50bht", although it would be nice, I don't expect to get 50, but would prefer at least around 48-49 than the 44-46 range of next stabilisation I see it settling at after the dollops of QE coming from BoE coming this year.

Regards 3 years spending- I will be buying land, building our dream self sufficient Manor and keeping a healthy amount of physical gold with in reach. I give myself a 1 year window to complete this transition so its a substantial amount of money but can be a bit flexible on movement timing. I'm thinking about to split the total in to 3 lump transfers and use this 4 week grace to try and target a decent rate or at least negotiate a better one than otherwise based on the size of the lump and future biz I can give then over using another banks service?

[15Peter20]

I'm trapped in GBP with nowhere to go. Aaaargh!!! It's cold and lonely down here. Can anyone see any light at the end of the tunnel?

[meatboy]

I'm trapped in GBP with nowhere to go. Aaaargh!!! It's cold and lonely down here. Can anyone see any light at the end of the tunnel?

with what news that is coming out of the uk.fears over their credit rating,the economy is taking a dive with the weather keeping shoppers at home i can see [or cant] that the light has gone out and the end is nigh,looks like you are going to have them leg irons on for a while so wrap up well

[nong38]

Thailand seems to think a strong bhat is good, which it is if you buying things, but if you are attracting tourists and exporting things which Thailand seems to be well into then someone should be asking a few questions. A buying country would be looking elsewhere if the price is looking high so when current contracts expire, if things continue as they are, then perhaps the cntracts will not be renewed but will anyone wonder why that is?

It wont happen straight away but it will happen as less expensive suppliers offer better deals and once you have moved if the new player takes care of you why would you want to go back?

Thailand seems to be impervious to what happens elsewhere in the world, there could be a rude awakening coming.

In the meantime, we suffer the pain on the BOT inactivity.

[mccw]

If the Thai suppliers are buying raw materials with a stronger bht then I suppose the increase labour cost could be balanced out and the end price to the purchaser not too badly affected?