Bye Bye Europe - Exapats and Holiday Goers.

[Mencken]

Euro now has dropped in a year from 44± to <35 -and will drop another ten percent easily. Unless BOT uses some magic, I don't see a home for Euro expats (incl N. Eu) here, German pensioners aside. Long stay holiday goers already rattled by the visa nonsense...

Is it game over for Europeans? Even Scandinavian currencies have been hit hard.

With the Russisns gone, is it game over for Thailand?

What does it mean to lose 3-7% of GDP, that mainly covers the porest and often least educated in hospitality snd service?

Edited March 11, 2015 by Mencken

[Brit_Doggie]

Thank god that britain for once was diplomatically correct for not joining the euro money go round err i mean down.

[morrobay]

Game over for Europeans. But why German pensioners aside ? Germany is on the Euro too.

[Berkshire]

Whoever leaves will be replaced, as always happens. The expat population in Thailand goes up every year. Maybe more Americans will be coming over. The dollar is doing fine and poised to do even better. And then there's the Chinese.

[Pib]

The EURO has surely been taking it on the chin lately with more of a beating to probably occur....but what goes around can come around to other currencies also eventually.

Per 10 year charts from XE.com they show how the Euro-Baht, USD-Baht, and GBP-Baht have oscillated over the last 10 years. Looks like the USD-THB has been fairly stable (i.e., give or take a few baht) since around late 2006 and the GBP-TBH has been fairly stable (i.e., give or take a few baht) since mid 2008. Yes, I know plus or minus a few baht can make a big difference in exchange rate, but over a long term plus or minus a few baht is normal oscillation. And it could very well be the current EUR-THB exchange rate of around 35 or a little low is setting a new normal oscillation mid point, but who really knows in the wild world of currency exchange rates and the myriad of known and unknown/unexpected events that can change the rate. Heck, many financial analysts are saying the EUR and USD will reach parity...then again many financial analysts have their own financial agenda in making projections and their projections may not be much better than a psychic.

EUR-THB

USD-THB

GBP-THB

[Asiantravel]

Whoever leaves will be replaced, as always happens. The expat population in Thailand goes up every year. Maybe more Americans will be coming over. The dollar is doing fine and poised to do even better. And then there's the Chinese.

'"Maybe more Americans will be coming over. The dollar is doing fine and poised to do even better"

I wouldn't be betting the farm on that

[Suradit69]

Long stay holiday goers already rattled by the visa nonsense...

Is it game over for Europeans? Even Scandinavian currencies have been hit hard.

With the Russisns gone, is it game over for Thailand?

What does the sinking Euro have to do with "the visa nonsense?'

I've been hearing the "final nail in the coffin" nonsense for 15 or more years every time something happens. Undoubtedly it's a blow for Euro dependent expats, but not all of them are living here on just enough to survive. In all probability the European economies will recover and the Euro will regain at least some of its lost value in a few years. For those expats who have already invested in a home or condo and have settled in, it may mean some belt-tightening but they should be able to weather the cyclical hit to the Euro. Those who cannot survive a short-term exchange devaluation probably weren't contributing that much to the Thai economy anyway and it would be better for everyone if they returned to their debt-ridden home countries. It's the financial world's way of culling the weak.

The same will be true for the Russians and others. Problems get solved and what goes down can just as easily go back up.

The Thai economy has survived the 1997 financial crash, several coups, tsunamis, the bird flu, political unrest in Bangkok and in the south. Probably the survival of the Eurozone, deflation in western economies and massive debt in the west & a return to recession there are more compelling concern for game over in those economies.

[Pib]

I see the Bank of Thailand unexpectedly cut their interest rate from 2.00% to 1.75% today....that should help weaken the baht just a little.

[GuyL]

Thank god that britain for once was diplomatically correct for not joining the euro money go round err i mean down.

FYI, back in January 2002, when physical euro coins and banknotes entered into circulation, you could then get 35 baht for one euro, 42 for one US dollar and 72 baht for one sterling pound at most exchange booths!

Well, it seems that even with its current depreciation, euro is still doing (comparatively) better against the baht than the pound and than the mighty US dollar since this date.

[MrWorldwide]

@suradit69, I've tried to make the same point you made in your final sentence on numerous occasions, but the doomsayers wont be happy until they get their financial tsunami. The notion that the Thai economy prospers or falters based solely on the number of Farang here at any given point in time seems to be the cornerstone of their argument - the Thais know they have much bigger fish to fry with their two largest trading partners, China and Japan : that's where I'd be focussing my attention if I wanted to know where Thailand is headed in 2015/16. I'll leave the rest of the crystal balling to those with considerably larger and shinier balls than my own.

[recycler]

What you all forget are the price increases here in Baht that have nothing to do with the Euro or other currencies.

I'm here 11 years now and have an income in Baht, so the Euro is not really hurting, but local price increases are unbelievable.

Food, schools, cars, houses, land, etc. Over the past year several of my daily expenses have gone up by 25 to 30%!

Relocating to Europe would not be such a problem now, much cheaper if you are with a family.

Thailand is nice, if you are rich and can afford the top level.

[96tehtarp]

IMO The best thing Thailand could do now is spend whole-hog on massive infrastructure projects in the order of trillions of baht. This will weaken the baht making exports and inbound tourism more competitive, while at the same time strengthen vital infrastructure which will be needed by the increased exports facilitated by a lower baht. gasp....

[Pib]

I see the Bank of Thailand unexpectedly cut their interest rate from 2.00% to 1.75% today....that should help weaken the baht just a little.

Just using today's Bangkok Bank TT Buying Rate used for incoming wire transfers, this morning's 8:30am rate for the USD was 32.52, GBP 48.9275, and Euro 34.715.

The afternoon's rate at 4:10pm after the BOT rate cut a few hours earlier the USD was 32.72 (up 0.61%), GBP 49.18 (up 0.52%) and Euro 34.73 (up 0.04%).

Looks like the rate cut was very positive for the USD and GBP but not so much so for the Euro, but I expect a lot of that is due to the Euro continuing to drop against most currencies today.

[dotpoom]

It would be far more expensive for me to live in Europe than it is for me living here. Here I can live comfortably....at home I'd be on the streets. (metaphorically speaking).

Edited March 11, 2015 by dotpoom

[harryfrompattaya]

Well where all the money people who kissed the dollar good bye 2 years ago.

Please do not count America out and gone

The American Bankers and their controllers have done a great job

I heard all the rich from all the world want to come to America and are doing it now

[Pib]

Well where all the money people who kissed the dollar good bye 2 years ago.

Please do not count America out and gone

The American Bankers and their controllers have done a great job

I heard all the rich from all the world want to come to America and are doing it now

Don't know about about the rich generally flocking to America, but many expecting Chinese mothers are...Chinese mothers who have money. See below partial quote from this 8 Feb 15 news article titled, Why Chinese moms want American babies

For many pregnant women, a pre-birth checklist might look like this: assemble the crib, buy extra bibs, pack essentials for the hospital. But for a growing number of expectant Chinese mothers, the list also includes buying a plane ticket to the U.S.

Pregnant Chinese moms are flocking stateside to give birth, lured by rules that grant American citizenship to anyone born on U.S. soil. A booming birth tourism industry has sprouted from coast to coast to cater to growing interest -- in 2012, about 10,000 Chinese women gave birth in the U.S., more than double the 4,200 in 2008, according to Chinese state media.

"If things become economically or politically uncertain in one's country of origin, the children have a place to come to," said Leti Volpp, a law professor at the University of California, Berkeley. The children can "then sponsor their parents when they turn 21."

The desire to leave China is especially pronounced among the wealthy. Almost two-thirds of Chinese with more than 10 million yuan ($1.6 million) in the bank have emigrated, or are planning to, according to a Hurun report released last year.

[shirtless]

I dont know about the final nail in the coffin , but this wont help TAT figures lets see what happens to the USD when they have to meet interest repayments ,

[MaeJoMTB]

Game over for Europeans. But why German pensioners aside ? Germany is on the Euro too.

They get massive pensions.

[MaeJoMTB]

It would be far more expensive for me to live in Europe than it is for me living here. Here I can live comfortably....at home I'd be on the streets. (metaphorically speaking).

Spain is very cheap.

House and apartment purchase prices cheaper than Thailand, rent not so.

And if you're British,

1.4 Euro to the GBP, at one point it was 1:1, so great exchange rate too.

Worth 40% more than 6 years ago, I might have ended up in Europe with an exchange rate like that.

Edited March 11, 2015 by MaeJoMTB

[Don Aleman]

Other holiday destinations, Japan for one, bulging with tourists who, once visiting nations with modern facilities, few scams, sensible holiday/immigration rules, will never come back here

How can such a small nation, with plenty of good tourist luring examples all around, make so many foolish decisions is all that's Amazing !

[Zendo]

Even when euro goes to 30.. I still enjoy life here, and I don't change my plans to live here very soon.

It's not only the money that makes life enjoyable here.. in Europe there is the weather, the mood.. well you know that well too ^^

[SOUTHERNSTAR]

What goes up comes down and the other way around. Thailand is in a very tight spot, with exports and tourism stagnant (+- 80% of GDP) the economic outlook is not that great. The property sector is in a bad shape with most Thai's over their ears in debt and the strong Baht detering foreigners from buying. FDI's are still down from the 2012/2013 levels and its only a matter of time before the USD strength will break the Bahts back. The unemployment rate is still low, but its rising. The drought in the north east and low commodity prices are breaking the farmers (remember that the Esaan grew 4% faster per year than BKK in the last decade because of the support of farm prices). By the way the BOT interest rate cut today is like a fart into a gail force wind. Between 2007 and 2014 the household debt in Thailand increased with 26% of GDP (to 87% of GDP). In a high income country increasing consumer spending may work but here its going to lead to a 1997/98 crash. The mega projects are still a year or more in the making before money will flow. The government is struggling to spend its budget. Lets not talk about the political situation which has cost the country +- 2% economic growth per year since late 2013. If the political situation worsens we could see a rapid decline in the Baht to the 1997/98 levels. Nothing in economics are a given nor constant.

[senor123]

All very interesting stuff but the reality is (according to my Thai missus) that things are not looking too good on the local front. A lot of people out of work, food prices going up, strong Thai baht making problems for exporters. I don't live in Thailand but have some investments there and I must say that it hasn't been all that bad considering that when I first started investing I was getting about 32 baht to the $AU. Now it is under 25 baht to the $AU. We are having good tenants asking for a reduction on their monthly rent because they are having trouble with their cost of living and our rents are 3 to 4 k baht a month. I think that now it is time in the sun for the Seppos and the $US and good luck to them!!!! It is all cyclical but if you walk the line when things are good you will probably go down the drain when things take a turn for the worse.

[Khun David]

My opinion is that the real estate market is soon going to collapse, Europeans for sure wont be buying, USA has never had a massive ex pat population here, Russian Ruble is devastated as are its short term prospects, Chinese are being offered residency if they invest in property in Portugal and Spain under the golden visa scheme. Hard to see who is going to buy the massive number of Condos that have been empty for several years, without even considering those massive blocks that are under construction. A few building projects in Jomtien close to me are operating day and night 7 days a week, They must know something i dont !!!

[chris2004]

It would be far more expensive for me to live in Europe than it is for me living here. Here I can live comfortably....at home I'd be on the streets. (metaphorically speaking).

Spain is very cheap.

House and apartment purchase prices cheaper than Thailand, rent not so.

And if you're British,

1.4 Euro to the GBP, at one point it was 1:1, so great exchange rate too.

Worth 40% more than 6 years ago, I might have ended up in Europe with an exchange rate like that.

The Euro is still strong

If you're British it was 1.50+ to the GBP not so long ago.

[adammike]

Thank god that britain for once was diplomatically correct for not joining the euro money go round err i mean down.

FYI, back in January 2002, when physical euro coins and banknotes entered into circulation, you could then get 35 baht for one euro, 42 for one US dollar and 72 baht for one sterling pound at most exchange booths!

Well, it seems that even with its current depreciation, euro is still doing (comparatively) better against the baht than the pound and than the mighty US dollar since this date.

Thats the market rate,I was on samui march 2002 and had to pay a hotel bill with my CC the rate was 32:90 that was the all time low i believe, the market rate now is 34:80 baht for one euro that means on the street/atm the euro must be at an all time low against the baht or will be any hour now,taking in to account

the price hike over the last couple of years in thailand, the no interest rate on our savings, our static wages and price hikes at home thats the end of thailand for me, it may change but not in the near future maybe not for the next 3-4 years.air fares have stayed the same thats all everything else sucks.

[MaeJoMTB]

It would be far more expensive for me to live in Europe than it is for me living here. Here I can live comfortably....at home I'd be on the streets. (metaphorically speaking).

Spain is very cheap.

House and apartment purchase prices cheaper than Thailand, rent not so.

And if you're British,

1.4 Euro to the GBP, at one point it was 1:1, so great exchange rate too.

Worth 40% more than 6 years ago, I might have ended up in Europe with an exchange rate like that.

The Euro is still strong

If you're British it was 1.50+ to the GBP not so long ago.

You are forgetting the property price crash in Spain and France.

[sawadee1947]

Thank god that britain for once was diplomatically correct for not joining the euro money go round err i mean down.

are you blind/ Check the charts! As the POUND is connected to the EURO it hits both currencies. The reason for the strong Dollar is the idea to push economy (see zero interests)

In the moment America or Europe will start again with rising interest rates, economy will slow again. So for this year we will have a weak Euro, but probably not next year. For the long run I estimate a Euro around 40 baht and the Pound around 48-50 (as long they are EU member. If they leave EU the pound will drop down to 30 Baht or even less

[robertthebruce]

I lived in ''France'' for quite some time, and it does not even come close to ''Thailand'' in 90 percent of most aspects..

The Friendlyness and the overall general Efficiency here , knocks spots of ''France''...

I could go on and on about it, but best not .... but ''France'' does not come anywhere near ''Thailand''...

[how241]

Whoever leaves will be replaced, as always happens. The expat population in Thailand goes up every year. Maybe more Americans will be coming over. The dollar is doing fine and poised to do even better. And then there's the Chinese.

+1...Pattaya seems to be getting more crowded all the time.