BOT admits Thai baht continued to appreciate

[crazykopite]

I for one believe that the Thai economy will be in melt down by the end of 2015 and having followed the Thai economy for the last few months there are a number of well known Thai economists who also have expressed there concerns a strong baht is not doing the country any favours it's not just about foreigners moaning about exchange rates it goes a lot deeper than that, businesses within the tourism industry are really struggling due to tourists choosing other destinations where there money will go a lot further.

[Eric Loh]

Let me guess, you're struggling to make ends meet from a measely income from outside of thailand, looking for someone to blame. So you decide to blame the exchange rate and convinced yourself the BoT is manipulating exchange rates even though you have no evidence whatsoever and clearly it would be in their own interest to do the opposite of what you are accusing them of doing.

Here's the truth. Thailand is a net importer of oil in the amount of about 12% of it's GDP. 12months ago they were paying $110 a barrel for oil they import. Today, they are paying half that amount. Effectively, saving the country 6% of GDP by money that is not flowing out of the country to pay for imports. Simply put, thailand is saving about $1bln to $1.5bln each month on their Balance of Trade. So even if thailand's exports flatline, the fact their imports costs less will add to the appreciation trend for the Baht.

Because of this, BoT may in fact be intervening in the currency. But not trying to make it stornger, they could possibly be doing the opposite, slowing down the appreciation. ]

So please stop your garbage talk about how it's a conspiracy that BoT is trying to make the Baht stronger (trying to kill their own economy perhaps?). You just sound like a pitiful conspiracy nutter.

Just that simple - right ?

it might be of interest to note that Thailand is primarily an exporter, tourism alone which is in fact an export accounts for more than 12% of GDP - then there's the rest

also using words like garbage and nutter when referring to other peoples input on this forum is far from constructive

as for myself it matters not a jot what the exchange rate is as I have a choice of using baht or my home currency

Yes, using those words is not constructive, I agree. But let's consider the facts. Here are 3:

1. There is no evidence whatsoever that they are intentially trying to make the Baht stronger

2. There is no motive to make the baht stronger, becuase it would simply damage the Thai economy by doing so.

3. There is a perfectly rational explanation explaining why the Baht could have a bias toward appreciating - which I outlined in my post above.

So, No evidence, No motive, and a simple explanation for the Baht's current level. What do you have except crazy conspiracy theories?

1. There is no evidence whatsoever that they are intentially trying to make the Baht stronger

never said there was - it was an opinion based on the fact that some of the richer Thais could benefit

2. There is no motive to make the baht stronger, becuase it would simply damage the Thai economy by doing so.

it is damaging the Thai economy, I thought that was obvious

3. There is a perfectly rational explanation explaining why the Baht could have a bias toward appreciating - which I outlined in my post above.

In your opinion

So, No evidence, No motive, and a simple explanation for the Baht's current level. What do you have except crazy conspiracy theories?

yours is a theory too

and look I replied to your post without the inclusion of one personal insult (no need for it), insults and personal attacks have no place on these forums - all it takes is one person to start and the thread goes down a meaningless pit

I'm not going to insult you Smedly because you normally post sensible stuff. But not here.

You posted your conspiracy theory about the BOT and Prasarn and other posters have asked for some evidence. You have provided none.

Yes the strong Baht is not good for many expats and some tend to post unverified accusations because they are hurting personally, with the country being of secondary (or worse) importance.

Thai At Heart posted a very sensible take on the issue which I agree with. Remember AFAIK the Thai Baht rate is based on a basket of currencies with the US$ obviously being the largest.

Finally a sensible post. Totally agreed with the point that Baht based on basket of currency of which USD is the most dominant and their movement influenced Baht immensely. Technically the BOT can manupulate the Baht with the large cache reserve Thailand has built up but doubt the junta government will allow that move. It will bring undesirable consequences like inflation, higher payment for foreign currency loans and confidence to the people. Things the junta trying to avoid.

[Melonade]

Good for folks that send a few bob home each month..

[anon4546543]

_{I do not understand why the baht is still so high. But no conspiracy theories from me. I do know that the AUD to baht was 33 to 1 about 4 years ago when I started to make plans to move to LOS. Now it is 23 to 24, more than 25% depreciation to me. And it does hurt me as I am building a house here. Such is economics and the current world situation. Not much use complaining about it or name calling. Cheers everyone, it will be raining soon and maybe cool down a few hotheads}

[Saan]

Some will never believe it but just the Thai way of saying they are going to manipulate the rate to suit their needs.

Let me guess, you're struggling to make ends meet from a measely income from outside of thailand, looking for someone to blame. So you decide to blame the exchange rate and convinced yourself the BoT is manipulating exchange rates even though you have no evidence whatsoever and clearly it would be in their own interest to do the opposite of what you are accusing them of doing.

No, your wrong, he is filthy rich like you and enjoys despising those who are poor. He knows the filthy rich are not greedy like the poor. It is only those who are struggling to make ends meet who hope the baht falls. The rest hope it goes from strength to strength. After all they are content with what they have and would never want more than their fair share.

[lucky11]

BOT admits Thai baht continued to appreciate

So the BOT is admitting the obvious. The entire Thai tourism industry knew this, along with export industries, tourists, and ex-pats.

With the benefit of hindsight, it seems this news release http://www.thaivisa.com/forum/topic/806996-kasikorn-thai-baht-to-fluctuate-between-3225-3255-per-us-dollar-this-week/?hl=%2Bbaht+%2Bdollar was an announcement that the Thai government intended to manipulate the baht to link it to the dollar. The dollar has been appreciating against most major currencies, taking the baht with it, and hurting the tourism and export sectors of the economy. Now it seems someone is using the recent small depreciation of the dollar to obscure what has been going on. Hopefully this will be used as cover to allow unlinking the baht from the dollar and allow the baht to sink to a reasonable value.

You can't manipulate the baht to link it to the dollar!!! It is either linked or decoupled (if it was previously linked to it). It is the currency markets that determine the rates.

You can alter the interest rates to affect the value of your currency or devalue it, but it has nothing to do with what value the dollar is, especially as it has not been linked to it for over 30 years.

[Godders]

Here is the myth of the US's "recovery" exposed for what it really is - and by a most unlikely source.

If the world's financial experts (sic) are so bullish about the the crumbling, corrupt and ineptly managed Thai economy, what does this say about the real value of the dollar - or for that matter the UK pound, the Euro and the rest of the currencies propped up only by massive injections of computer-generated funny money (or quantitative easing, to use the official jargon) by the Federal Reserve and the rest of the privately owned and managed central banks?

The reality is that the world is living on borrowed time because only around three per cent of the cash, of whatever currency, presently in circulation is backed by an asset. The greedy crapitalist (no, it's not a typo) system, which is in effect a gigantic ponzi scheme aimed at perpetually transferring money from the relative poor to the rich, is irretrievably broken and the so-called developed nations are hopelessly in debt to a small, immensely wealthy and immovably entrenched private banking cartel which controls the global money supply on a scale beyond anything we have known in human history.

What we are witnessing right now is little more than a gigantic, pointless and ultimately doomed endgame of pass the parcel, with household-name banks up to their neck in off-book debt (a quadrillion or so, at the last count), mainly in dodgy financial instruments like derivatives and credit default swaps, which are the ultimate form of the Monopoly money on which the crapitalist (no typo) system depends for its very survival. .

When the music eventually stops, as it must, the entire Alice in Wonderland edifice of what the experts (sorry, another sic is justified) laughingly refer to as a global monetary system will collapse in unimaginable and utterly unmanageable chaos. There is no obvious solution, except the one that Mad Hatters running the political dumb-show on behalf of their money masters have always turned to in desperation at times of extreme crisis - a world war.

Of course, it could just be a coincidence that Russia has won the international vote as the world's most unpopular state. . .

[tbthailand]

Some will never believe it but just the Thai way of saying they are going to manipulate the rate to suit their needs.

Not the needs of the country, but the needs of a select few.

I suspect that you are right, but I have not seen anything that points to that fact more (or less) directly...

[Naam]

Some will never believe it but just the Thai way of saying they are going to manipulate the rate to suit their needs.

Let me guess, you're struggling to make ends meet from a measely income from outside of thailand, looking for someone to blame. So you decide to blame the exchange rate and convinced yourself the BoT is manipulating exchange rates even though you have no evidence whatsoever and clearly it would be in their own interest to do the opposite of what you are accusing them of doing.

Here's the truth. Thailand is a net importer of oil in the amount of about 12% of it's GDP. 12months ago they were paying $110 a barrel for oil they import. Today, they are paying half that amount. Effectively, saving the country 6% of GDP by money that is not flowing out of the country to pay for imports. Simply put, thailand is saving about $1bln to $1.5bln each month on their Balance of Trade. So even if thailand's exports flatline, the fact their imports costs less will add to the appreciation trend for the Baht.

Because of this, BoT may in fact be intervening in the currency. But not trying to make it stornger, they could possibly be doing the opposite, slowing down the appreciation. ]

So please stop your garbage talk about how it's a conspiracy that BoT is trying to make the Baht stronger (trying to kill their own economy perhaps?). You just sound like a pitiful conspiracy nutter.

Just that simple - right ?

it might be of interest to note that Thailand is primarily an exporter, tourism alone which is in fact an export accounts for more than 12% of GDP - then there's the rest

also using words like garbage and nutter when referring to other peoples input on this forum is far from constructive

as for myself it matters not a jot what the exchange rate is as I have a choice of using baht or my home currency

that Thailand is primarily an export nation is a fairy tale. during the last 20 years the trade balance was negative in 9 of these years.

the figures for 2014 are:

exports............$ 232.0 billion

imports............$ 218.5 billion

margin....................5.82%

examples of "primarily export nations"

Germany:

exports............$ 1.547 trillion

imports............$ 1.319 trillion

margin.....................14.74%

China

exports............$ 2.252 trillion

imports............$ 1.949 trillion

margin.....................13.45%

source: CIA Factbook

[Balance]

Some will never believe it but just the Thai way of saying they are going to manipulate the rate to suit their needs.

Let me guess, you're struggling to make ends meet from a measely income from outside of thailand, looking for someone to blame. So you decide to blame the exchange rate and convinced yourself the BoT is manipulating exchange rates even though you have no evidence whatsoever and clearly it would be in their own interest to do the opposite of what you are accusing them of doing.

Here's the truth. Thailand is a net importer of oil in the amount of about 12% of it's GDP. 12months ago they were paying $110 a barrel for oil they import. Today, they are paying half that amount. Effectively, saving the country 6% of GDP by money that is not flowing out of the country to pay for imports. Simply put, thailand is saving about $1bln to $1.5bln each month on their Balance of Trade. So even if thailand's exports flatline, and the fact their imports cost less, and their balance of trade is improving, will add to the appreciation trend for the Baht.

Because of this, BoT may in fact be intervening in the currency. But not trying to make it stornger, they could possibly be doing the opposite, slowing down the appreciation. ]

So please stop your garbage talk about how it's a conspiracy that BoT is trying to make the Baht stronger (trying to kill their own economy perhaps?). You just sound like a pitiful conspiracy nutter.

The main reason for the appreciation of the Bhat is that TBT is using those saved hard currency and buying Bhat on the currency markets to keep it's value up. But a lot of what is said is speculation as there is no reporting of the ACTIONS of the government or TBT.

[chiang mai]

Some will never believe it but just the Thai way of saying they are going to manipulate the rate to suit their needs.

Let me guess, you're struggling to make ends meet from a measely income from outside of thailand, looking for someone to blame. So you decide to blame the exchange rate and convinced yourself the BoT is manipulating exchange rates even though you have no evidence whatsoever and clearly it would be in their own interest to do the opposite of what you are accusing them of doing.

Here's the truth. Thailand is a net importer of oil in the amount of about 12% of it's GDP. 12months ago they were paying $110 a barrel for oil they import. Today, they are paying half that amount. Effectively, saving the country 6% of GDP by money that is not flowing out of the country to pay for imports. Simply put, thailand is saving about $1bln to $1.5bln each month on their Balance of Trade. So even if thailand's exports flatline, and the fact their imports cost less, and their balance of trade is improving, will add to the appreciation trend for the Baht.

Because of this, BoT may in fact be intervening in the currency. But not trying to make it stornger, they could possibly be doing the opposite, slowing down the appreciation. ]

So please stop your garbage talk about how it's a conspiracy that BoT is trying to make the Baht stronger (trying to kill their own economy perhaps?). You just sound like a pitiful conspiracy nutter.

The main reason for the appreciation of the Bhat is that TBT is using those saved hard currency and buying Bhat on the currency markets to keep it's value up. But a lot of what is said is speculation as there is no reporting of the ACTIONS of the government or TBT.

If that were true, we'd see a dramatic fall in the value of foriegn currency reserve USD holdings, do you see that!

http://www2.bot.or.th/statistics/BOTWEBSTAT.aspx?reportID=80&language=ENG

Also, how does your view that BOT is propping up the Baht corespond with the BOT view that they are trying to stop the Baht from appreciating too quickly?

http://news.thaivisa.com/thailand/bot-admits-thai-baht-continued-to-appreciate/53769/

[Thai at Heart]

_{I do not understand why the baht is still so high. But no conspiracy theories from me. I do know that the AUD to baht was 33 to 1 about 4 years ago when I started to make plans to move to LOS. Now it is 23 to 24, more than 25% depreciation to me. And it does hurt me as I am building a house here. Such is economics and the current world situation. Not much use complaining about it or name calling. Cheers everyone, it will be raining soon and maybe cool down a few hotheads}

Go look at interest rates and respective government debt. Price earnings of relative stock markets and gdp growth. Thailand is not some horrendous basket case unlike half of Europe, much of the USA and parts of the UK. All of these economies have had horrible recessions and have built up considerable govt debt which is essentially double the respective level of Thai govt debt.

Yes, the Thai economy is slowing and they can cut interest rates if they like, but it is the weakness of the Western economies causing this, not strength of Thailand.

The USA, UK and Europe have never had recessions like this and never had debt levels like this. Thailand had their problem in 97 now the rest of the world has theirs.

Or did everyone not notice the problems in the economies of the rest of the world?

[Thai at Heart]

Some will never believe it but just the Thai way of saying they are going to manipulate the rate to suit their needs.

Let me guess, you're struggling to make ends meet from a measely income from outside of thailand, looking for someone to blame. So you decide to blame the exchange rate and convinced yourself the BoT is manipulating exchange rates even though you have no evidence whatsoever and clearly it would be in their own interest to do the opposite of what you are accusing them of doing.

Here's the truth. Thailand is a net importer of oil in the amount of about 12% of it's GDP. 12months ago they were paying $110 a barrel for oil they import. Today, they are paying half that amount. Effectively, saving the country 6% of GDP by money that is not flowing out of the country to pay for imports. Simply put, thailand is saving about $1bln to $1.5bln each month on their Balance of Trade. So even if thailand's exports flatline, and the fact their imports cost less, and their balance of trade is improving, will add to the appreciation trend for the Baht.

Because of this, BoT may in fact be intervening in the currency. But not trying to make it stornger, they could possibly be doing the opposite, slowing down the appreciation. ]

So please stop your garbage talk about how it's a conspiracy that BoT is trying to make the Baht stronger (trying to kill their own economy perhaps?). You just sound like a pitiful conspiracy nutter.

The main reason for the appreciation of the Bhat is that TBT is using those saved hard currency and buying Bhat on the currency markets to keep it's value up. But a lot of what is said is speculation as there is no reporting of the ACTIONS of the government or TBT.

If that were true, we'd see a dramatic fall in the value of foriegn currency reserve USD holdings, do you see that!

http://www2.bot.or.th/statistics/BOTWEBSTAT.aspx?reportID=80&language=ENG

Also, how does your view that BOT is propping up the Baht corespond with the BOT view that they are trying to stop the Baht from appreciating too quickly?

http://news.thaivisa.com/thailand/bot-admits-thai-baht-continued-to-appreciate/53769/

Exactly, the BOT is not buying baht to strengthen anything. It has been busy accumulating dollars for 15 years. And ironically now has as much forex on hand as some of our home countries.

They have more than enough to ward off a run on the baht.

[flyingdoc]

It would be good for this to be substantiated by some real facts !

[Naam]

It would be good for this to be substantiated by some real facts !

if you don't trust any Thai publications look up the facts at the website of the International Monetary Fund.

[Srikcir]

"The National Economic and Social Development Board of Thailand (NESDB) has forecast three percent growth in the first quarter of 2015"

It's almost the end of April 2015. Instead of forecasting the GDP growth rate for 2015Q1 that ended March 31, why not state what it actually is? I suspect within the week we'll see the actual results will be lower than 3% and the government is trying to forestall that news.

[billphillips]

Its about time to consider the substantiation of a currency's value. So many real and even rumoured events can influence it's real value. Of corse in the short term certain things can be done to offset this.

Let's start at the time of the massive bkk floods or the political riots/demonstrations on the streets. Think about the turmoil following the military intervention, the unfortunate and widely publicised murders, the withdrawal of some US funding, the rice problem, unacceptance of the government (worldwide), cancelation of Thai flights, fishing exports threatened, tourism reduced, exports reduced and on and on etc. Of course any and all of these will affect the value of any currency adversely. Except of course the thai Baht. Why? The BOT is the biggest purchaser of the Baht. Who else would buy such a shaky currency? The Thai gold and currency reserves are being spent at a massive rate and on a daily basis. It is unsustainable. Look at the daily spikes in the exchange rates, hmmm. If a run on the Baht starts, and it will, watch out for a rapid demise and welcome release for the poorer Thai people.

[osiboy]

Some will never believe it but just the Thai way of saying they are going to manipulate the rate to suit their needs.

Let me guess, you're struggling to make ends meet from a measely income from outside of thailand, looking for someone to blame. So you decide to blame the exchange rate and convinced yourself the BoT is manipulating exchange rates even though you have no evidence whatsoever and clearly it would be in their own interest to do the opposite of what you are accusing them of doing.

Here's the truth. Thailand is a net importer of oil in the amount of about 12% of it's GDP. 12months ago they were paying $110 a barrel for oil they import. Today, they are paying half that amount. Effectively, saving the country 6% of GDP by money that is not flowing out of the country to pay for imports. Simply put, thailand is saving about $1bln to $1.5bln each month on their Balance of Trade. So even if thailand's exports flatline, and the fact their imports cost less, and their balance of trade is improving, will add to the appreciation trend for the Baht.

Because of this, BoT may in fact be intervening in the currency. But not trying to make it stornger, they could possibly be doing the opposite, slowing down the appreciation. ]

So please stop your garbage talk about how it's a conspiracy that BoT is trying to make the Baht stronger (trying to kill their own economy perhaps?). You just sound like a pitiful conspiracy nutter.

and oil is only cheaper in thailand is it ? ,...i thought it was global so it should not make any diff if all countries are having the samr benefit from it ,..............NO ?

[Thai at Heart]

Its about time to consider the substantiation of a currency's value. So many real and even rumoured events can influence it's real value. Of corse in the short term certain things can be done to offset this.

Let's start at the time of the massive bkk floods or the political riots/demonstrations on the streets. Think about the turmoil following the military intervention, the unfortunate and widely publicised murders, the withdrawal of some US funding, the rice problem, unacceptance of the government (worldwide), cancelation of Thai flights, fishing exports threatened, tourism reduced, exports reduced and on and on etc. Of course any and all of these will affect the value of any currency adversely. Except of course the thai Baht. Why? The BOT is the biggest purchaser of the Baht. Who else would buy such a shaky currency? The Thai gold and currency reserves are being spent at a massive rate and on a daily basis. It is unsustainable. Look at the daily spikes in the exchange rates, hmmm. If a run on the Baht starts, and it will, watch out for a rapid demise and welcome release for the poorer Thai people.

Where do u have any proof that Thailand is spending it's forex? If anything, the cheaper oil is making their imports reduce in value.

There is no effort to prop up the baht.

[Thai at Heart]

Some will never believe it but just the Thai way of saying they are going to manipulate the rate to suit their needs.

Let me guess, you're struggling to make ends meet from a measely income from outside of thailand, looking for someone to blame. So you decide to blame the exchange rate and convinced yourself the BoT is manipulating exchange rates even though you have no evidence whatsoever and clearly it would be in their own interest to do the opposite of what you are accusing them of doing.

Here's the truth. Thailand is a net importer of oil in the amount of about 12% of it's GDP. 12months ago they were paying $110 a barrel for oil they import. Today, they are paying half that amount. Effectively, saving the country 6% of GDP by money that is not flowing out of the country to pay for imports. Simply put, thailand is saving about $1bln to $1.5bln each month on their Balance of Trade. So even if thailand's exports flatline, and the fact their imports cost less, and their balance of trade is improving, will add to the appreciation trend for the Baht.

Because of this, BoT may in fact be intervening in the currency. But not trying to make it stornger, they could possibly be doing the opposite, slowing down the appreciation. ]

So please stop your garbage talk about how it's a conspiracy that BoT is trying to make the Baht stronger (trying to kill their own economy perhaps?). You just sound like a pitiful conspiracy nutter.

and oil is only cheaper in thailand is it ? ,...i thought it was global so it should not make any diff if all countries are having the samr benefit from it ,..............NO ?

Well of course that would depend if you are an importer or exporter of oil wouldn't it......

[pattayasnowman]

====================================================================================
BANGKOK, 23 April 2015, (NNT) - The Bank of Thailand (BOT) has admitted that the Thai baht has recently appreciated, due to under-performing economic figures in the United States causing the dollar to depreciate.

==================================================================================

Don't know what chart this guy is looking at but the US$ has been appreciating against all major currencies for over the past year - see chart below.

With regards to the Baht - its the BOT policy to maintain the Baht in a trading range against the US$. Essentially 'pegging' it to that range which is 32.00 - 33.00

It does this by holding a basket of reserve foreign currency of between 100 to 140 billion dollars. The weighting of this basket is 60% US$, 30% EUR 10% Yen.

As such It can easily 'manipulate' the Baht/US$ rate on the forex since the daily volume is miniscule approx 750 contacts. Compared to over 1/2 million contracts for the US$/EUR

The BOT seeks a stable dollar exchange rate since about 80% of Thailands exports are paid in US$. Exporters also want a stable exchange rate, and they have a limited time to convert their US$ to Baht. That used to be ,I think, 2 weeks .

The current 32.5 rate to the US$ also matches the Historical Average rate since 1980 ( including the 1997 Asian Crises when the Rate went as high as 55 for a period of time)

Edited April 23, 2015 by pattayasnowman

[chiang mai]

Too many questions:

Where have you read about the BOT policy of pegging THB to USD, where/when was it anounced?

How long has that policy been in force, presumably not before 9 December 2013?

Does BOT really holds only USD, EUR and YEN in its foriegn reserves and where can this be seen in their reserves holding balance sheet?

http://www2.bot.or.th/statistics/BOTWEBSTAT.aspx?reportID=80&language=ENG

On the subject of managing THB using only USD, UR and YEN: do you mean the BOT doesn't manage for ASEAN countries nor hold YUAN?

Do exporters really only have two weeks to convert their USD earning to THB, I thought is was a year?

[chiang mai]

OK, perhaps we should deal with the basket of currencies issue first:

Under the new basket, the number of countries in the basket has increased from 21 to 23 and countries from 32 to 38. The selction of new currencies/countries is based on trading partners and countries with the potential to become competitors in third country markets.

It's an interesting read which prov ides chapter and verse.

.https://www.bot.or.th/English/FinancialMarkets/ForeignExchangeMarket/RelatedArticles/BOT_DocLib/BoxCh3E-281010.pdf

Edited April 24, 2015 by chiang mai

[Ballbearing]

This is my take on it from a very basic perspective.

I have no doubt I will be shot down in flames but will try anyway.

My salary is in US$ which is then paid into an AU$ account.

I then send AU$ to my thai account and change to baht.

I am currently making good money on the US/AU conversions but losing it all when going through the AU/THB conversion.

Australia was charging along for years with huge sales of coal and iron ore and the AU$ was very high against the US$ (and by default the THB).

Then China stopped buying these resources and the prices plunged and at the same time the US economy started improving.

Subsequently the AU$ has crashed against the US$ (and by default the THB) and is almost on parity with the NZ$ (which has never even come close before).

Does this not then mean the US, NZ and Thai economies are strong and the Australian economy is weak ?

[chiang mai]

Not if you look at it in GDP terms, on that basis NZ is the weaker of the pack:

http://en.wikipedia.org/wiki/List_of_countries_by_GDP_%28nominal%29

But economic strength is measured in other ways, as well as by GDP, debt, deficit, unemployment rates, markit surveys, there's a myriad of different ways to measure it.

Also, strength and weakness is a relative term, weaker or stronger specifically aginst which country.

[smedly]

This is my take on it from a very basic perspective.

I have no doubt I will be shot down in flames but will try anyway.

My salary is in US$ which is then paid into an AU$ account.

I then send AU$ to my thai account and change to baht.

I am currently making good money on the US/AU conversions but losing it all when going through the AU/THB conversion.

Australia was charging along for years with huge sales of coal and iron ore and the AU$ was very high against the US$ (and by default the THB).

Then China stopped buying these resources and the prices plunged and at the same time the US economy started improving.

Subsequently the AU$ has crashed against the US$ (and by default the THB) and is almost on parity with the NZ$ (which has never even come close before).

Does this not then mean the US, NZ and Thai economies are strong and the Australian economy is weak ?

China did not stop buying iron from Australia - they bought the mines, Australia stupidly let them do it and are now going down the (deleted) at an extreme rate of knots

[billphillips]

Its about time to consider the substantiation of a currency's value. So many real and even rumoured events can influence it's real value. Of corse in the short term certain things can be done to offset this.

Let's start at the time of the massive bkk floods or the political riots/demonstrations on the streets. Think about the turmoil following the military intervention, the unfortunate and widely publicised murders, the withdrawal of some US funding, the rice problem, unacceptance of the government (worldwide), cancelation of Thai flights, fishing exports threatened, tourism reduced, exports reduced and on and on etc. Of course any and all of these will affect the value of any currency adversely. Except of course the thai Baht. Why? The BOT is the biggest purchaser of the Baht. Who else would buy such a shaky currency? The Thai gold and currency reserves are being spent at a massive rate and on a daily basis. It is unsustainable. Look at the daily spikes in the exchange rates, hmmm. If a run on the Baht starts, and it will, watch out for a rapid demise and welcome release for the poorer Thai people.

Where do u have any proof that Thailand is spending it's forex? If anything, the cheaper oil is making their imports reduce in value.

There is no effort to prop up the baht.

No, show me the proof that they are not. The BOT are buying Baht. Who else in their right mind would buy a into the currency of a country with an uncertain future, a rather unstable political situation, failing exports, failing tourism, red carded airplanes, yellow carded fishing exports and a ministry of silly comments.

Your comment about oil ... Omg.

[asiamaster]

Exactly my point. Thanks for explaining!

====================================================================================
BANGKOK, 23 April 2015, (NNT) - The Bank of Thailand (BOT) has admitted that the Thai baht has recently appreciated, due to under-performing economic figures in the United States causing the dollar to depreciate.

==================================================================================

Don't know what chart this guy is looking at but the US$ has been appreciating against all major currencies for over the past year - see chart below.

With regards to the Baht - its the BOT policy to maintain the Baht in a trading range against the US$. Essentially 'pegging' it to that range which is 32.00 - 33.00

It does this by holding a basket of reserve foreign currency of between 100 to 140 billion dollars. The weighting of this basket is 60% US$, 30% EUR 10% Yen.

As such It can easily 'manipulate' the Baht/US$ rate on the forex since the daily volume is miniscule approx 750 contacts. Compared to over 1/2 million contracts for the US$/EUR

The BOT seeks a stable dollar exchange rate since about 80% of Thailands exports are paid in US$. Exporters also want a stable exchange rate, and they have a limited time to convert their US$ to Baht. That used to be ,I think, 2 weeks .

The current 32.5 rate to the US$ also matches the Historical Average rate since 1980 ( including the 1997 Asian Crises when the Rate went as high as 55 for a period of time)

[Chao Lao Beach]

The world's major currencies are affected by their countries own domestic economic situation. Yet the Thai baht's value appears to be impervious to Thailand's economic frailties.

Why?

Well, lets just pretend you are in a position where you can gain large maounts of baht, we all know that there is zer corruption in Thailand so there of course is no way that wealth could be gained by a Gov emplloyee on 30,000b a month, but just pretend...

Developed countries lets otheres buy stuff there, not like Thailand, and say one wants to get their money out of Thailand beofre the housing bubble pops, you get more bang for your baht with it artifically strong.

[smedly]

The world's major currencies are affected by their countries own domestic economic situation. Yet the Thai baht's value appears to be impervious to Thailand's economic frailties.

Why?

Well, lets just pretend you are in a position where you can gain large maounts of baht, we all know that there is zer corruption in Thailand so there of course is no way that wealth could be gained by a Gov emplloyee on 30,000b a month, but just pretend...

Developed countries lets otheres buy stuff there, not like Thailand, and say one wants to get their money out of Thailand beofre the housing bubble pops, you get more bang for your baht with it artifically strong.

spot on, it's a shame you had to explain it to the seemingly self appointed clever people posting on this topic