baht appreciation in the last few weeks

[mike111]

In the past weeks the baht has appreciated against several major currencies such as the euro, aussie & canadian dollars. Minor change with the us dollar.

Why does it appreciate against such currencies, and is there a correction/devaluation coming soon?

Cheers

[Pib]

Probably because those other currencies (i.e., Euro, AUD, CAD) depreciated in value against a basket of currencies...not only against the baht but other currencies also.

Don't just think "how strong or weak does the baht appear to be"; you also have to think "how strong or weak are the other currencies in relation to the baht and other world currencies." In currency pairs you need to evaluate both currencies; not just one of them. If both currencies get equally stronger (or weaker) at the same time their value to each other probably won't change....but if "one" of those two currencies gets stronger or weaker, then the exchange rate will change.

[ldnguy]

100s of similar posts on here. Read them. For the reason, ask every single person why they bought and sold the baht and you'll have your answer.

[ldnguy]

Yes, a correction is coming soon. I heard that it will happen at 2:17 on 28 September.

[bkksteve123]

The appreciation of the Thai Baht has been going on since the military coup. This most likely because investor confidence in Thailand stabilised (somewhat) adding to foreign investment in Thailand (have a look at the stock market since the coup in May 2014 http://www.bloomberg.com/quote/SET:IND), meaning large transactions made buying Thai Baht, although from what I remember reading, the buyers of Thai stocks post-coup were mostly thai.

The US Dollar has surged in recent months, which is why the USD/THB rate has not declined to the same extent.

As a previous poster said, the EUR, AUD, CAD, JPY have themselves declined against a basket of currencies lately. The Euro reached a new multi-year low against the USD just this week.

[ToddinChonburi]

I think it was July when the baht was almost 33 for one US dallor, it goes up and down all the time. I will be awaiting the correction at 2:17 on the 28th. Maybe it will have also something on the 15% in Khao Tao.

[bertty]

There are many factors as to why currencies rise and fall.

The Pound lost 3.5 baht when it looks like Scotland was going to leave the UK, since it didn't happen it has risen again.

The U.S.A is off to war again which will affect the Dollar.

It is not just financial things that affect.

[petermik]

There are many factors as to why currencies rise and fall.

The Pound lost 3.5 baht when it looks like Scotland was going to leave the UK, since it didn't happen it has risen again.

The U.S.A is off to war again which will affect the Dollar.

It is not just financial things that affect.

The pound risen again-it was 55.45 a month ago now its at 52.40-what rise am I missing

[MrWorldwide]

OK - I'm not an economist but this is my two Satangs worth re the Pacific Peso - happy to hear from pib or someone else who actually knows what they're talking about if I got any of this wrong

- the Aussie is currently at a 2-year low against both the greenback and the baht

- US signalled interest rates to rise soon sparking sentiment that the long-awaited recovery is now on in earnest

- the 'experts' who saw the end of the mining boom and a decline in China's phenomenal growth claim the AUD is simply returning to 'normal' levels against the greenback

- most analysts see the Aussie ending 2014 at 87 cents which is still somewhere around the 28 baht mark atm

- predictions for 2015 seem to be anywhere from 77 cents to 95 cents - clearly, their crystal balls are as finely tuned as they were 12 months ago when some were throwing around numbers as low as 66 cents in 2014

77 cents seems to be the magical figure where exporters are happy and importers can still gouge Australian consumers and blame it on exchange rates. For those of us living in Thailand with Australian dollars in the bank, we will probably be looking at something south of 25 baht to the dollar if the baht maintains its current strength against the greenback. Tough if you're already trying to make ends meet here but for most tourists I still think the cost of airfares and accommodation will continue to make Thailand an attractive destination, and as long as Thailand remains a low wage country with relatively good infrastructure I just dont see that long-awaited devaluation happening. We can all gaze longingly at the 32 baht highs on the 2Y chart, but IMO those days are well and truly behind us.

http://www.xe.com/currencycharts/?from=AUD&to=THB&view=2Y

Right now, I'm somewhere between patting myself on the back for having the 'foresight' to change some of my nestegg to baht back in the heady days of 29.5 earlier this year and kicking myself for not commiting to a larger transaction, but a quick look at those charts shows us that the Aussie does something very interesting after a sharp drop - I suspect that this says as much about the nature of currency markets as it does about the fundamentals of the recent fall. I'm waiting for the bounce but wary of that old chestnut 'Never underestimate the market's ability to remain irrational for longer than you can remain solvent'. I guess we'll know if I'm right by mid-October.

As with anything you read on the net, my 'predictions' could be 180-degrees out - pure speculation - but its hard to look at those graphs and see the Aussie as low as 66 cents or anything as high as 95 cents. If it does happen, I expect that a few random thoughts on TV will be the absolute least of my concerns.

[Lukecan]

They have a trade surplus every year.

Lots of foreign money coming in from tourism.

Baht will continue to appreciate against major currencies in the long run.

[bertty]

There are many factors as to why currencies rise and fall.

The Pound lost 3.5 baht when it looks like Scotland was going to leave the UK, since it didn't happen it has risen again.

The U.S.A is off to war again which will affect the Dollar.

It is not just financial things that affect.

The pound risen again-it was 55.45 a month ago now its at 52.40-what rise am I missing

The one where it went from 51.40 to 52.50. Sorry if that is hard to understand.

[mike111]

77 cents seems to be the magical figure where exporters are happy and importers can still gouge Australian consumers and blame it on exchange rates. For those of us living in Thailand with Australian dollars in the bank, we will probably be looking at something south of 25 baht to the dollar if the baht maintains its current strength against the greenback. Tough if you're already trying to make ends meet here but for most tourists I still think the cost of airfares and accommodation will continue to make Thailand an attractive destination, and as long as Thailand remains a low wage country with relatively good infrastructure I just dont see that long-awaited devaluation happening. We can all gaze longingly at the 32 baht highs on the 2Y chart, but IMO those days are well and truly behind us.

It seems unlikely that a country which is so heavily dependant on tourism & exports can afford to have its currency appreciate for a long time. It wouldnt be a surprise if a devaluation occurs soon, possibly by cutting bank interest rates.