Thai baht dropping big time!

[Anon999]

bloody Brits and there over priced currency then they wonder why there is no work .... ah but its good for the ego worth worth more than every body .. I can remember when Canadian dollar was high and they reduced it we sold a lot more products ..

Sterling has only over the past month made up for lagging behind both the US$ and the euro against the Baht. Just check the rates since, say end of December 2012 and compare the 3 currencies. Your opinion doesn't stack up against the figures.

[cassde]

I wish........

[TheFishman1]

Ever body thinking great the Bht is down just wondering if inflation goes up same same get more pay mor

[TheFishman1]

Ever body thinking great the Bht is down just wondering if inflation goes up same same get more pay mor

[muchogra]

What big time?

Now, for me, to buy gold contracts on the Thai exchange - near the 1200 mark.

Don't do it like me though, for I don't invest in long term during certain periods!

[muchogra]

If any ordinary investor says the Thai market is too small to invest in, I say they've got no significant money to invest in in the first place.

SET50 is B1,000 per point. Going long or short, it's up to you, but don't tell me it's small, and has no liquidity! It does have liquidity but the faint- hearted may get a heart stroke for what the big boys play you! For me? It's been short!

Edited December 2, 2013 by muchogra

[moradave]

Screw all that. How's it doing against the Bitcoin?

1 BitCoin = 30,043 baht. Up about 900% in last 2 months.

[chiang mai]

Do your research before you shout!

The Thai Baht trades on a managed peg to the US Dollar, the relationship of THB to USD is vital in determining the value of THB.

GBP/USD trades on a fully open market basis.

Ergo, GBP/THB is determined by the value of GBP/USD, got it!

The Thai Baht trades on a managed peg to the US Dollar

So are you saying that the USD/THB has fixed paramters that it can't move out of ? as i don't know what you mean by "managed peg"

The GBP/THB is worked on the cross between the Cable ( GBP/USD) and the USD/THB, if the dollar is weak against the pound then you would also expect to be weak against other currencies including the baht, eg. a higher cable and a lower USD/THB therefore in theory the GBP/THB wouldn't change agreat deal.

It dropped the peg in 1997 I believe. But I agree one should do research preferably in the same year one is speaking of.

The hard peg was dropped in 1998 and the managed peg was adopted.

[Naam]

The Thai Baht trades on a managed peg to the US Dollar

It dropped the peg in 1997 I believe. But I agree one should do research preferably in the same year one is speaking of.

The hard peg was dropped in 1998 and the managed peg was adopted.

-make that July 2, 1997 please.

-a managed peg was neither adopted nor does it officially exist.

Edited December 2, 2013 by Naam

[chiang mai]

-make that July 2, 1997 please.

The hard peg was dropped in 1998 and the managed peg was adopted.

-a managed peg was neither adopted nor does it officially exist.

I stand corrected, the hard peg was indeed dropped in 1997. My nomenclature is also incorrect in that I had intended to refer to the managed float and not the managed peg, apologies to all. In practice however THB is measured against USD and BOT is active from time to time to ensure the relationship between THB and USD is maintained at desirable levels.

Edited December 2, 2013 by chiang mai

[Bernard Flint]

Time soon to bring 40,000gbp from investment fund

[thailiketoo]

-make that July 2, 1997 please.

The hard peg was dropped in 1998 and the managed peg was adopted.

-a managed peg was neither adopted nor does it officially exist.

I stand corrected, the hard peg was indeed dropped in 1997. My nomenclature is also incorrect in that I had intended to refer to the managed float and not the managed peg, apologies to all. In practice however THB is measured against USD and BOT is active from time to time to ensure the relationship between THB and USD is maintained at desirable levels.

Like Thailand has enough money to do that. Switzerland maybe. Thailand never. Thailand is still subject to being manipulated by large investors outside of the government.

[chiang mai]

-make that July 2, 1997 please.

The hard peg was dropped in 1998 and the managed peg was adopted.

-a managed peg was neither adopted nor does it officially exist.

I stand corrected, the hard peg was indeed dropped in 1997. My nomenclature is also incorrect in that I had intended to refer to the managed float and not the managed peg, apologies to all. In practice however THB is measured against USD and BOT is active from time to time to ensure the relationship between THB and USD is maintained at desirable levels.

Like Thailand has enough money to do that. Switzerland maybe. Thailand never. Thailand is still subject to being manipulated by large investors outside of the government.

THB is a very small and largely insignificant currency in FOREX terms, it doesn't cost very much to move it one way or the other. And the BOT has foreign currency reserves of USD 169 bill, that's more than most countries in the West - plus, THB is a semi closed currency that cannot be exported in large amounts hence it's not fully freely convertible,

[thailiketoo]

-make that July 2, 1997 please.

The hard peg was dropped in 1998 and the managed peg was adopted.

-a managed peg was neither adopted nor does it officially exist.

I stand corrected, the hard peg was indeed dropped in 1997. My nomenclature is also incorrect in that I had intended to refer to the managed float and not the managed peg, apologies to all. In practice however THB is measured against USD and BOT is active from time to time to ensure the relationship between THB and USD is maintained at desirable levels.

Like Thailand has enough money to do that. Switzerland maybe. Thailand never. Thailand is still subject to being manipulated by large investors outside of the government.

THB is a very small and largely insignificant currency in FOREX terms, it doesn't cost very much to move it one way or the other. And the BOT has foreign currency reserves of USD 169 bill, that's more than most countries in the West - plus, THB is a semi closed currency that cannot be exported in large amounts hence it's not fully freely convertible,

That's why I said the government can try to maintain the baht at a particular level but does not have the funds to really do so like Switzerland who can actually fend off challenges to raise the value of the CHF. The THB moved from 40 to 30 in a relatively short period of time. You think the government wanted that?

[chiang mai]

-make that July 2, 1997 please.

The hard peg was dropped in 1998 and the managed peg was adopted.

-a managed peg was neither adopted nor does it officially exist.

I stand corrected, the hard peg was indeed dropped in 1997. My nomenclature is also incorrect in that I had intended to refer to the managed float and not the managed peg, apologies to all. In practice however THB is measured against USD and BOT is active from time to time to ensure the relationship between THB and USD is maintained at desirable levels.

Like Thailand has enough money to do that. Switzerland maybe. Thailand never. Thailand is still subject to being manipulated by large investors outside of the government.

THB is a very small and largely insignificant currency in FOREX terms, it doesn't cost very much to move it one way or the other. And the BOT has foreign currency reserves of USD 169 bill, that's more than most countries in the West - plus, THB is a semi closed currency that cannot be exported in large amounts hence it's not fully freely convertible,

That's why I said the government can try to maintain the baht at a particular level but does not have the funds to really do so like Switzerland who can actually fend off challenges to raise the value of the CHF. The THB moved from 40 to 30 in a relatively short period of time. You think the government wanted that?

Absolutely they did, a strong Baht is exactly what the government wants although anything more than 30 hurts exports. It was a popular myth on these boards for many months that BOT was supporting THB to make it artificially strong whereas in reality they were, at one point, spending reserves to weaken the currency, at around 31 in a normal none QE tapering/withdrawal environment THB appears to be self sustaining.

EDIT: sorry, the other point to make here is that another of BOT's objectives is ASEAN and the need to manage THB against a basket of regional currencies, many of which are linked officially or otherwise to trade and the value of USD, SGD in particular.

Edited December 3, 2013 by chiang mai

[thailiketoo]

Like Thailand has enough money to do that. Switzerland maybe. Thailand never. Thailand is still subject to being manipulated by large investors outside of the government.

THB is a very small and largely insignificant currency in FOREX terms, it doesn't cost very much to move it one way or the other. And the BOT has foreign currency reserves of USD 169 bill, that's more than most countries in the West - plus, THB is a semi closed currency that cannot be exported in large amounts hence it's not fully freely convertible,

That's why I said the government can try to maintain the baht at a particular level but does not have the funds to really do so like Switzerland who can actually fend off challenges to raise the value of the CHF. The THB moved from 40 to 30 in a relatively short period of time. You think the government wanted that?

Absolutely they did, a strong Baht is exactly what the government wants although anything more than 30 hurts exports. It was a popular myth on these boards for many months that BOT was supporting THB to make it artificially strong whereas in reality they were, at one point, spending reserves to weaken the currency, at around 31 in a normal none QE tapering/withdrawal environment THB appears to be self sustaining.

EDIT: sorry, the other point to make here is that another of BOT's objectives is ASEAN and the need to manage THB against a basket of regional currencies, many of which are linked officially or otherwise to trade and the value of USD, SGD in particular.

No for two reasons. 1. The THB was at 40 or above for quite some time. If the government could have changed it the would have. 2. The USA used to be Thailand's largest trading partner now it's not.

[chiang mai]

THB is a very small and largely insignificant currency in FOREX terms, it doesn't cost very much to move it one way or the other. And the BOT has foreign currency reserves of USD 169 bill, that's more than most countries in the West - plus, THB is a semi closed currency that cannot be exported in large amounts hence it's not fully freely convertible,

That's why I said the government can try to maintain the baht at a particular level but does not have the funds to really do so like Switzerland who can actually fend off challenges to raise the value of the CHF. The THB moved from 40 to 30 in a relatively short period of time. You think the government wanted that?

Absolutely they did, a strong Baht is exactly what the government wants although anything more than 30 hurts exports. It was a popular myth on these boards for many months that BOT was supporting THB to make it artificially strong whereas in reality they were, at one point, spending reserves to weaken the currency, at around 31 in a normal none QE tapering/withdrawal environment THB appears to be self sustaining.

EDIT: sorry, the other point to make here is that another of BOT's objectives is ASEAN and the need to manage THB against a basket of regional currencies, many of which are linked officially or otherwise to trade and the value of USD, SGD in particular.

No for two reasons. 1. The THB was at 40 or above for quite some time. If the government could have changed it the would have. 2. The USA used to be Thailand's largest trading partner now it's not.

I don't think it's possible or even sensible to try and use historic averages to determine an appropriate level of a currency, the best you can get from that is a very approximate guess that discounts so many factors. For example,THB was above 40 until around 2006 when it started to strengthen because of QE in the West, 2007 onwards was a period of tremendous growth in Asia and in particular in Thailand, even though QE may taper soon, much of that growth and investment will have stuck.

But I don't see your point about USA being the largest trading partner before, all trade bills are settled in USD regardless of who the partner is.

[thailiketoo]

Sorry I don't understand. The quotes messed up.

[Naam]

chiang mai

But I don't see your point about USA being the largest trading partner before, all trade bills are settled in USD regardless of who the partner is.

no fairy tales please!

[alfieconn]

-make that July 2, 1997 please.

The hard peg was dropped in 1998 and the managed peg was adopted.

-a managed peg was neither adopted nor does it officially exist.

I stand corrected, the hard peg was indeed dropped in 1997. My nomenclature is also incorrect in that I had intended to refer to the managed float and not the managed peg, apologies to all. In practice however THB is measured against USD and BOT is active from time to time to ensure the relationship between THB and USD is maintained at desirable levels.

All central banks do us this with their currencies, nothing new or unique !

[alfieconn]

Whats the dollar got to do with the baht and pound ?

You should be saying if the Pound is strong then you'll get more Baht per Pound.

Do your research before you shout!

The Thai Baht trades on a managed peg to the US Dollar, the relationship of THB to USD is vital in determining the value of THB.

GBP/USD trades on a fully open market basis.

Ergo, GBP/THB is determined by the value of GBP/USD, got it!

The Thai Baht trades on a managed peg to the US Dollar

So are you saying that the USD/THB has fixed paramters that it can't move out of ? as i don't know what you mean by "managed peg"

The GBP/THB is worked on the cross between the Cable ( GBP/USD) and the USD/THB, if the dollar is weak against the pound then you would also expect to be weak against other currencies including the baht, eg. a higher cable and a lower USD/THB therefore in theory the GBP/THB wouldn't change agreat deal.

So to put it in simple terms if the cable GBP/USD is higher because of the strength of the pound then the GBP/THB would go higher but if the GBP/USD was higher because of the dollar being weaker then it wouldn't affect the GBP/THB price.

I didn't have to any research as i know how currency trading works, so are you still advocating if the Dollar is weak then you'll get more Baht per Pound, even though i have explained everything to you above ?

You've already been wrong on 2 statements :

The Thai Baht trades on a managed peg to the US Dollar

GBP/THB is determined by the value of GBP/USD, got it! Incorrect

GBP/THB is determined by the value of GBP/USD and the value of the USD/THB as that is how the price is worked out.

Now if you'd said "if the Dollar is weak and the thai central bank is buying dollars against the Baht then you'll get more Baht per Pound" that would have been correct !

Edited December 3, 2013 by alfieconn

[phitsanulokjohn]

Have patience my friends.You ain't seen nothing yet.The best is yet to come.

[Naam]

-make that July 2, 1997 please.

The hard peg was dropped in 1998 and the managed peg was adopted.

-a managed peg was neither adopted nor does it officially exist.

I stand corrected, the hard peg was indeed dropped in 1997. My nomenclature is also incorrect in that I had intended to refer to the managed float and not the managed peg, apologies to all. In practice however THB is measured against USD and BOT is active from time to time to ensure the relationship between THB and USD is maintained at desirable levels.

Like Thailand has enough money to do that. Switzerland maybe. Thailand never. Thailand is still subject to being manipulated by large investors outside of the government.

due to domestic and especially due to offshore restrictions a manipulation of THB is not possible.

this is what your bank tells you when buying/holding Thai Baht offshore:

Dear Client,

Thai Baht Currency Restrictions

Further to the Bank of Thailand’s Measure No. 33/2003 (Additional Measure to Prevent Thai Baht Speculation), which came into effect in October 2003, XYZ Bank, Singapore Branch is subject to restrictions affecting its holdings of Thai Baht currency. These include the following:

Maintaining THB accounts in Thailand for settlement purposes only, where settlement means the settlement of securities transactions and cash payment transactions. The exception is for deposits of a tenor of at least 6 months or more.

Forfeiture of credit interest on its accounts (other than deposits of a tenor of at least 6 months or more)

Ensuring that the aggregated end of day balances for cash accounts with all financial institutions in Thailand do not exceed THB 300 million (the “Daily THB Limit”)

Imposition of deposit charge on THB account balances.

In relation to the Daily THB Limit, XYZ Bank, Singapore Branch will be required to adjust its Thai Baht balances in all its client accounts to be compliant with the permitted level as determined by the Thai authorities on a daily basis. As such accounts may include balances in Thai Baht held on your behalf, it is critical that we are able to adjust client THB balances to ensure compliance.

Accordingly, at any time that you are holding a long position in THB, we reserve the right in our absolute discretion and without prior notice to you to convert your holding of THB, in whole or part, into United States dollars at the prevailing spot rate.

Yours truly,

XYZ Bank, Singapore Branch

[phitsanulokjohn]

sam sip satang. Doesn't seem like a "big" move to me.

52.45 to 52.75

Allow me to suggest an avatar tablet in these turbulent times we're in

No you're quiet correct.Big time would = a sudden drop to 60+ to the pound and continue to fall sharply.Now wouldn't that be lovely?

[thailiketoo]

-make that July 2, 1997 please.

The hard peg was dropped in 1998 and the managed peg was adopted.

-a managed peg was neither adopted nor does it officially exist.

I stand corrected, the hard peg was indeed dropped in 1997. My nomenclature is also incorrect in that I had intended to refer to the managed float and not the managed peg, apologies to all. In practice however THB is measured against USD and BOT is active from time to time to ensure the relationship between THB and USD is maintained at desirable levels.

Like Thailand has enough money to do that. Switzerland maybe. Thailand never. Thailand is still subject to being manipulated by large investors outside of the government.

due to domestic and especially due to offshore restrictions a manipulation of THB is not possible.

this is what your bank tells you when buying/holding Thai Baht offshore:

Dear Client,

Thai Baht Currency Restrictions

Further to the Bank of Thailand’s Measure No. 33/2003 (Additional Measure to Prevent Thai Baht Speculation), which came into effect in October 2003, XYZ Bank, Singapore Branch is subject to restrictions affecting its holdings of Thai Baht currency. These include the following:

Maintaining THB accounts in Thailand for settlement purposes only, where settlement means the settlement of securities transactions and cash payment transactions. The exception is for deposits of a tenor of at least 6 months or more.

Forfeiture of credit interest on its accounts (other than deposits of a tenor of at least 6 months or more)

Ensuring that the aggregated end of day balances for cash accounts with all financial institutions in Thailand do not exceed THB 300 million (the “Daily THB Limit”)

Imposition of deposit charge on THB account balances.

In relation to the Daily THB Limit, XYZ Bank, Singapore Branch will be required to adjust its Thai Baht balances in all its client accounts to be compliant with the permitted level as determined by the Thai authorities on a daily basis. As such accounts may include balances in Thai Baht held on your behalf, it is critical that we are able to adjust client THB balances to ensure compliance.

Accordingly, at any time that you are holding a long position in THB, we reserve the right in our absolute discretion and without prior notice to you to convert your holding of THB, in whole or part, into United States dollars at the prevailing spot rate.

Yours truly,

XYZ Bank, Singapore Branch

I said outside of the government not outside of the country.

Edited December 3, 2013 by thailiketoo

[chiang mai]

For alfieconn

Spot the difference:

Forex.docx

Edited December 3, 2013 by chiang mai

[alfieconn]

For alfieconn

Spot the difference:

[attachment=243469:Forex.docx

Yes confirms what i said earlier

So to put it in simple terms if the cable GBP/USD is higher because of the strength of the pound then the GBP/THB would go higher

The crux of it is you said if the Dollar is weak then you'll get more Baht per Pound, which i don't agree with :

E.g. USD/THB 32 CABLE 1.63 GBP/THB 52.16

DOLLAR WEAKENS by approx 12% TO all currencies, so USD/THB 28.16 CABLE 1.8536 GBP/THB 52.20 Roughly the same GBP/THB rates

The recent increase of GBP/THB is due to the pound strengthening not the dollar weakening !

Edited December 3, 2013 by alfieconn

[Naam]

I said outside of the government not outside of the country.

how do you manipulate domestically "outside of the government" the existing currency without involving another currency? the answer is a clear "no can do!" because restrictions prevail in the domestic market too.

[thailiketoo]

I said outside of the government not outside of the country.

how do you manipulate domestically "outside of the government" the existing currency without involving another currency? the answer is a clear "no can do!" because restrictions prevail in the domestic market too.

If I owned a non government Thai bank could I buy baht with dollars? As a Thai could I sell baht for dollars? Could a Thai buy gold with baht and dollars?

As a Thai I don't see what would prevent me from altering the supply of Thai baht into another currency or metal.

If I understand you what you are saying is; a private Thai bank or other private institution could not alter the money supply in Thailand?

So that makes the baht immune from fluctuations not orchestrated by Thai government?

The Thai government controls the rate of exchange between the Baht, dollar and pound?

Edited December 3, 2013 by thailiketoo

[marquis22]

It's more to do with the strength of the US economy and the USD rising against other currencies