Baht stable this week, down slightly on external factors, BOT says

[HOAX]

In one hand I`m getting more out of the Norwegian kroners when there are wars and crisis in oil and gas rich regions and Thailand. The NOK\THB currencies are really dancing, but just small adjustments can make as much as 15 000 baht more or less a month. For the last 2-3 years it has been increasing. At the lowest 1 kroner was 4.60 baht or so during the time I`ve been in Thailand. It`s now at 5,49. In my case that makes an 65 300 thb increase a month from the lowest.

In the other hand I would rather see Thai economy flourish, better infrastructure, better schools and education, better healthcare, more industries and innovation, pension, greater opportunities in wealth and health. I think that will do everyone good, even when it means my Norwegian money is less worth.

[tonbridgebrit]

The Thai baht right now, is 55.05 to one British pound.

Well, if it does not head down to 43 baht, I'ill be happy. 43 baht per pound was the rate last year in April.

I still remember when Yingluk won the election last time, a stack of people wrote stuff on Thai Visa about how the baht was going to weaken !
Nonsense comments like "65 baht to a pound, here we go", and similar other comments. Off-course, most of us knew that such comments were nonsense.
Yes, the 'currency markets' usually prefer elected civilian governments rather than military governments brought in by coups. Hey, maybe the 'currency markets' have got it wrong, and most of the posters on Thai Visa have got it right !

[chiang mai]

The best rate I can find in Thailand currently is Kasikorn at 54.63 per Pound, XE's rate of 55.05 is the midpoint, and anyway, you can't actually exchange currency at XE!

[jaideeguy]

Just like Thai people, the THB seems to defy all logic..............totally unpredictable.

[Thai at Heart]

It's sinking fast.

Curfew has stopped most of the factory night shifts (33% production cut).

Rice is almost worthless.

Tourists are not going to be coming for years.

Civil war predicted likely in the next 6 months.

Most of the foreign manufacturing is looking for a way out of this country, floods, coups, curfews, rising wage casts.

The only way is down.

Your view might be credible were it not for the fact that you are negative on everything.

US economy is doing well and the value of the dollar will rise against the Baht for the next few years.

Seems like a positive opinion to me!

Your second post about the value of the dollar (with which I agree) is no attempt to justify what you said in the first one which was all negative.

What is sinking fast? The economy, the Baht, Bangkok itself?

The curfew has been adjusted to a minimal amount of time and has no effect on night shifts now.

Rice in storage may be next to worthless but the grain itself isn't.

The number of times I've heard the doomsday forecast about tourism is staggering, usually from those who don't know what they're talking about or have an axe to grind (or both).

Another crystal ball gazer about civil war. It can never be discounted but there's every chance that the army has nipped it in the bud. The possibility is far less now after the army has taken over.

All factors blocking economic progress have now been removed and the money is already starting to flow into the economy (rice repayments). Inward investment, at a standstill for the last 6 months can resume as can budget disbursements.

No, it's not near 100% rosy, but it's looking a lot better than two weeks ago.

About a year agoุ the baht was about as stromg as it had been for 10 years. What in reality changed?

Politics.

Thus, hopefully this puts to bed one theory that is thrown around all the time. Devalue the currency a bit and exports will boom. How much has Thailand's export figure jumped because of the devaluation.

Almost nothing.

So, unless people like living surrounded by people desperate and on the bones of their ass, let's believe that a slowly appreciating currency to reflect the wealth of the country is a good thing, even if it means your pension doesn't go so far.

I remember 97, it wasn't pretty.

[Thai at Heart]

Just being reading bloomberg news, and for me it seems like the bath is far from stable

Royal Thai Army soldiers keep watch from a military vehicle stationed outside the Royal Thai Police headquarters in central Bangkok. Global banks from Goldman Sachs Group Inc. to Morgan Stanley cut forecasts for Thailands economic growth after the nations political turmoil culminated in the military takeover. Photographer: Dario Pignatelli/Bloomberg

Thailands baht posted 2014s biggest monthly slide and bonds fell as a May 22 military coup prompted global investors to pull about $2 billion from the nations debt and stocks.

The currency slumped 1.4 percent in May to 32.820 per dollar as of 4:03 p.m. in Bangkok, the worst performance in Asia, according to data compiled by Bloomberg. It lost 0.8 percent this week. The five-year bond yield climbed seven basis points from April 30 to 3.11 percent and reached a seven-week high of 3.15 percent on May 27, data compiled by Bloomberg show.

Foreigners have been selling bonds and stocks as we still dont know when elections will be held and there remains concern about how the situation will develop, said Kozo Hasegawa, a currency trader at Sumitomo Mitsui Banking Corp. in Bangkok. That weighs on the baht and the baht may maintain a weaker bias for now.

Global banks from Goldman Sachs Group Inc. to Morgan Stanley cut forecasts for Thailands economic growth as the political turmoil culminated in the military takeover. Southeast Asias second-biggest economy shrank 0.6 percent in the first quarter as demonstrations hurt production and tourism. Goldman now predicts a 0.5 percent contraction for the whole year while Morgan Stanley sees zero growth.

Trade Numbers

Exports dropped 0.9 percent last month from a year earlier, compared with a 2.7 percent decline in March, central bank data showed today. The trade surplus narrowed to $560 million from $3.5 billion. The current account, the broadest measure of trade, slipped into deficit for the first time since October. It swung to a $643 million shortfall, from Marchs $2.9 billion excess.

Army Chief Prayuth Chan-Ocha seized power on May 22 after seven months of protests, leading to clashes that claimed 28 lives. The military government said returning the country to civilian rule soon is impossible because the threat of further violence means it cant guarantee an election would be free and fair.

The Stock Exchange of Thailand share index proved more resilient, rising 0.2 percent in May following an 11 percent gain over the previous three months.

The coup was meant to end the political unrest that led to an annulled election in February and the ouster of Prime Minister Yingluck Shinawatra three months later, according to the army. Instead, protesters have ignored martial law and returned to Bangkoks streets this week, this time to oppose the militarys takeover and call for the return of civilian rule.

One-month implied volatility in the baht, a measure of expected exchange-rate moves used to price options, fell three basis points this month to 5.53 percent. The gauge touched a one-month high of 6.81 percent on May 23.

The cost to insure the nations bonds for five-years using credit-default swaps fell two basis points in May to 120, CMA prices show. That compares with a six-month average of 135.

To contact Bloomberg News staff for this story: Yumi Teso in Bangkok at [email protected]

To contact the editors responsible for this story: James Regan at [email protected] Simon Harvey, Anil Varma

Military coups are hardly calming for the markets.

[VegasVic]

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I think all of you should be so ashamed of yourselves the Thai Baht in two years shall be 28.78 to the dollars Buy the Baht and be a positive richer pro Thai Farang

Harry, I hope you are not "eating your own cooking" with that advice there my friend, because the Baht/Dollar will likely be close to 36 by years end and the Dollar will contiue to gain strength during 2015 as the FED is forced to rein in the money supply and begin to raise interest rates The free ride that U.S. multinational corporations have been enjoying for the past 10 years with the artificially weak U.S. dollar is about to come to and end, and far as the value of the Thai Baht vs. the Dollar goes the Baht will most definately weaken thereby helping Thai exports and the overall Thai economy, the BOT will have very little control as to where the Baht winds up vs. the Dollar once the interest rates in the U.S. begin to rise

[chiang mai]

Post 35, TAH:

Only partially true but I overall I agree with the sentiment. What else has changed includes tapering of QE and the associated capital outflows.

Another thing that has changed is the viability of the Chinese economy, I note that property prices in China and Singapore still have some way to fall and they are on their way.

[Thai at Heart]

Post 35, TAH:

Only partially true but I overall I agree with the sentiment. What else has changed includes tapering of QE and the associated capital outflows.

Another thing that has changed is the viability of the Chinese economy, I note that property prices in China and Singapore still have some way to fall and they are on their way.

Well, I see it that the USA issues make up about 70% of the movements, thailand and the rest 30%.

If the sentiment from the USA is one way and the other 30% help it, it can move quick. The 30% can slow movement,but not make one on its own.

The 30% adds or removes momentum but cannot move it much alone. Chinese property and genral lending is the 100000000 tonne gorilla in the room. How low can Chinese interest rates go to keep the economy moving and how bad will the damage be if and when the property bubble bursts.

[i claudius]

The best rate I can find in Thailand currently is Kasikorn at 54.63 per Pound, XE's rate of 55.05 is the midpoint, and anyway, you can't actually exchange currency at XE!

you can get 54.75 per pound in most booths here in Pattaya , the British economy is getting better all the time .

[phutoie2]

Bangkok Bank 54.16 to 1 GBP at close of play last night. Thats what I expect my UK pension to come in at. Anyone know what the booths in Bangkok are exchanging at?. I noticed it was poor at the airport last week.

[tonbridgebrit]

Bangkok Bank 54.16 to 1 GBP at close of play last night. Thats what I expect my UK pension to come in at. Anyone know what the booths in Bangkok are exchanging at?. I noticed it was poor at the airport last week.

The rate at the airport is the worst rate for switching whatever foreign currency into Thai baht ! On the same day, the rates in the Pattaya and Bangkok booths are much better !

[VegasVic]

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Post 35, TAH:

Only partially true but I overall I agree with the sentiment. What else has changed includes tapering of QE and the associated capital outflows.

Another thing that has changed is the viability of the Chinese economy, I note that property prices in China and Singapore still have some way to fall and they are on their way.

Well, I see it that the USA issues make up about 70% of the movements, thailand and the rest 30%.

If the sentiment from the USA is one way and the other 30% help it, it can move quick. The 30% can slow movement,but not make one on its own.

The 30% adds or removes momentum but cannot move it much alone. Chinese property and genral lending is the 100000000 tonne gorilla in the room. How low can Chinese interest rates go to keep the economy moving and how bad will the damage be if and when the property bubble bursts.

Thai at heart, If you look at the real estate numbers out of China the other day you will see that property values have already started to decline, the initial cracks in the Chinese real estate bubble have begun and the shadow banking system will now be exposed for what it is (or is not). Chinese investment in the Kingdom will begin to pull back very shortly and then when the FED begins to increase interest rates these factors will combine to become a double whammy for the Thai baht The decline in the Bahts value should be a good thing for the overall Thai economy, as long as it is a gradual decline and not a crash like in 97

[Thai at Heart]

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Post 35, TAH:

Only partially true but I overall I agree with the sentiment. What else has changed includes tapering of QE and the associated capital outflows.

Another thing that has changed is the viability of the Chinese economy, I note that property prices in China and Singapore still have some way to fall and they are on their way.

Well, I see it that the USA issues make up about 70% of the movements, thailand and the rest 30%.

If the sentiment from the USA is one way and the other 30% help it, it can move quick. The 30% can slow movement,but not make one on its own.

The 30% adds or removes momentum but cannot move it much alone. Chinese property and genral lending is the 100000000 tonne gorilla in the room. How low can Chinese interest rates go to keep the economy moving and how bad will the damage be if and when the property bubble bursts.

Thai at heart, If you look at the real estate numbers out of China the other day you will see that property values have already started to decline, the initial cracks in the Chinese real estate bubble have begun and the shadow banking system will now be exposed for what it is (or is not). Chinese investment in the Kingdom will begin to pull back very shortly and then when the FED begins to increase interest rates these factors will combine to become a double whammy for the Thai baht The decline in the Bahts value should be a good thing for the overall Thai economy, as long as it is a gradual decline and not a crash like in 97

I am not sure what exactly the Chinese are directly investing in in Thailand. They have some FDI, but it still isn't as big as Japan or the USA.

I think the reduction in printing money in the USA is critical. Problem is, when they reduce it,GDP tanks. So they need continual stimulus. At the end of the day, the world is awash with USD debt, so I don't think anything is going to tank versus the USD as it did in 97.

Its a relative and the baht at 33 to the USD seems fair enough considering the mess in Thailand. That can be sorted very fast and if the new junta cuts Thai borrowing but can keep GDP moving all of a sudden Thailand with 3% interest rates and steady GDP growth and stability looks like a good bet. The last thing the USA really wants is a strengthening USD.

The debt to GDP for Thailand still looks low in comparison with the rest of the world. 30 to 33 to the USD seems fair enough.

Edited May 31, 2014 by Thai at Heart

[VegasVic]

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Post 35, TAH:

Only partially true but I overall I agree with the sentiment. What else has changed includes tapering of QE and the associated capital outflows.

Another thing that has changed is the viability of the Chinese economy, I note that property prices in China and Singapore still have some way to fall and they are on their way.

Well, I see it that the USA issues make up about 70% of the movements, thailand and the rest 30%.

If the sentiment from the USA is one way and the other 30% help it, it can move quick. The 30% can slow movement,but not make one on its own.

The 30% adds or removes momentum but cannot move it much alone. Chinese property and genral lending is the 100000000 tonne gorilla in the room. How low can Chinese interest rates go to keep the economy moving and how bad will the damage be if and when the property bubble bursts.

Thai at heart, If you look at the real estate numbers out of China the other day you will see that property values have already started to decline, the initial cracks in the Chinese real estate bubble have begun and the shadow banking system will now be exposed for what it is (or is not). Chinese investment in the Kingdom will begin to pull back very shortly and then when the FED begins to increase interest rates these factors will combine to become a double whammy for the Thai baht The decline in the Bahts value should be a good thing for the overall Thai economy, as long as it is a gradual decline and not a crash like in 97

I am not sure what exactly the Chinese are directly investing in in Thailand. They have some FDI, but it still isn't as big as Japan or the USA.

I think the reduction in printing money in the USA is critical. Problem is, when they reduce it,GDP tanks. So they need continual stimulus. At the end of the day, the world is awash with USD debt, so I don't think anything is going to tank versus the USD as it did in 97.

Its a relative and the baht at 33 to the USD seems fair enough considering the mess in Thailand. That can be sorted very fast and if the new junta cuts Thai borrowing but can keep GDP moving all of a sudden Thailand with 3% interest rates and steady GDP growth and stability looks like a good bet. The last thing the USA really wants is a strengthening USD.

The debt to GDP for Thailand still looks low in comparison with the rest of the world. 30 to 33 to the USD seems fair enough.

I hope (and think) that the weakening Baht will be a gradual thing, not like the crash in 97. The markets always determine what is fair (or not fair) , so any arbitrary number like 30 or 33 is just something to talk about. The U.S. has many fiscal problems to be sorted out over the coming years so the U.S. Dollar rising vs the Baht or any other currency is not a statement on how great the U.S. is, rather it is just a matter of how the markets will react to a tightening money supply and rising interest rates and from history we know what will happen when this begins. I will also add that the U.S. Dollar has been held at artificially low levels for many years in order to give its multinational companies and advantage and in an attempt to rectify its trade deficit Where the exchange rate for the Thai Baht shakes out a couple of years from now is anybodies guess, however if I were a wagering man I would wager it will be north of your 30-33 range

[chiang mai]

I was reading an article this morning that talked about the attempts by the EU to increase inflation, one of the tools for that is to drop the central bank rate to zero or indeed, to send them negative. Given that the UK central bank is now openly discussing interest rate hikes, needed to help prevent the economy from overheating, that means the strategies of the two banks are exactly opposite. The implication of that is that the Pound is likely to soar even higher as investment money piles out of Europe into a safe haven that has an improved yield outlook. I'm not sure that the UK really wants or needs that stronger Pound but it may not have a lot of choice in the matter, either way, it's likely to make a lot of Thai based expats very happy.

[tonbridgebrit]

Baht Posts Worst Month of 2014 as $2 Billion Pulled Amid Coup

By Bloomberg News May 30, 2014 5:01 PM GMT+0700

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Photographer: Dario Pignatelli/Bloomberg

Royal Thai Army soldiers keep watch from a military vehicle stationed outside the Royal... Read More

Thailand’s baht posted 2014’s biggest monthly slide and bonds fell as a May 22 military coup prompted global investors to pull about $2 billion from the nation’s debt and stocks.

The currency slumped 1.4 percent in May to 32.820 per dollar as of 4:03 p.m. in Bangkok, the worst performance in Asia, according to data compiled by Bloomberg. It lost 0.8 percent this week. The five-year bond yield climbed seven basis points from April 30 to 3.11 percent and reached a seven-week high of 3.15 percent on May 27, data compiled by Bloomberg show.

“Foreigners have been selling bonds and stocks as we still don’t know when elections will be held and there remains concern about how the situation will develop,” said Kozo Hasegawa, a currency trader at Sumitomo Mitsui Banking Corp. in Bangkok. “That weighs on the baht and the baht may maintain a weaker bias for now.”

Global banks from Goldman Sachs Group Inc. to Morgan Stanley cut forecasts for Thailand’s economic growth as the political turmoil culminated in the military takeover. Southeast Asia’s second-biggest economy shrank 0.6 percent in the first quarter as demonstrations hurt production and tourism. Goldman now predicts a 0.5 percent contraction for the whole year while Morgan Stanley sees zero growth.

Trade Numbers

Exports dropped 0.9 percent last month from a year earlier, compared with a 2.7 percent decline in March, central bank data showed today. The trade surplus narrowed to $560 million from $3.5 billion. The current account, the broadest measure of trade, slipped into deficit for the first time since October. It swung to a $643 million shortfall, from March’s $2.9 billion excess.

Army Chief Prayuth Chan-Ocha seized power on May 22 after seven months of protests, leading to clashes that claimed 28 lives. The military government said returning the country to civilian rule soon is “impossible” because the threat of further violence means it can’t guarantee an election would be free and fair.

The Stock Exchange of Thailand share index proved more resilient, rising 0.2 percent in May following an 11 percent gain over the previous three months.

The coup was meant to end the political unrest that led to an annulled election in February and the ouster of Prime Minister Yingluck Shinawatra three months later, according to the army. Instead, protesters have ignored martial law and returned to Bangkok’s streets this week, this time to oppose the military’s takeover and call for the return of civilian rule.

One-month implied volatility in the baht, a measure of expected exchange-rate moves used to price options, fell three basis points this month to 5.53 percent. The gauge touched a one-month high of 6.81 percent on May 23.

The cost to insure the nation’s bonds for five-years using credit-default swaps fell two basis points in May to 120, CMA prices show. That compares with a six-month average of 135.

To contact Bloomberg News staff for this story: Yumi Teso in Bangkok at [email protected]

To contact the editors responsible for this story: James Regan at [email protected] Simon Harvey, Anil Varma

[jpeg]

About a year agoุ the baht was about as stromg as it had been for 10 years. What in reality changed?

Politics.

Thus, hopefully this puts to bed one theory that is thrown around all the time. Devalue the currency a bit and exports will boom. How much has Thailand's export figure jumped because of the devaluation.

Almost nothing.

So, unless people like living surrounded by people desperate and on the bones of their ass, let's believe that a slowly appreciating currency to reflect the wealth of the country is a good thing, even if it means your pension doesn't go so far.

I remember 97, it wasn't pretty.

For me, it was fabulously beautiful . And no. I don't give a rats' about the Thais and their 'economy' .

[Thai at Heart]

I was reading an article this morning that talked about the attempts by the EU to increase inflation, one of the tools for that is to drop the central bank rate to zero or indeed, to send them negative. Given that the UK central bank is now openly discussing interest rate hikes, needed to help prevent the economy from overheating, that means the strategies of the two banks are exactly opposite. The implication of that is that the Pound is likely to soar even higher as investment money piles out of Europe into a safe haven that has an improved yield outlook. I'm not sure that the UK really wants or needs that stronger Pound but it may not have a lot of choice in the matter, either way, it's likely to make a lot of Thai based expats very happy.

The UK has cooked the property market again to a point that it is red hot at least in London.

They have to put up interest rates. It might strengthen the pound but the fallout for the property market will probably be horrible. The amount of houses funding large mortgages that will struggle with higher payments is many.

Why they let govt get reckless with houses I don't know.

[Thai at Heart]

About a year agoุ the baht was about as stromg as it had been for 10 years. What in reality changed?

Politics.

Thus, hopefully this puts to bed one theory that is thrown around all the time. Devalue the currency a bit and exports will boom. How much has Thailand's export figure jumped because of the devaluation.

Almost nothing.

So, unless people like living surrounded by people desperate and on the bones of their ass, let's believe that a slowly appreciating currency to reflect the wealth of the country is a good thing, even if it means your pension doesn't go so far.

I remember 97, it wasn't pretty.

For me, it was fabulously beautiful . And no. I don't give a rats' about the Thais and their 'economy' .

That's fine. I did OK out of it too. The western backlash was limited to Soros. Next time if it happens it might be different.