BOT admits Thai baht continued to appreciate

[Benmart]

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.

TT:

When one attacks the poster, the post seems to be more of a personal assault and the intellectual merit is diminished.

It is hard for some to leave out the "you's", "your's". The name calling (nutter) and questioning someones financial status is ineffective and self-defeating.

The post did have some merit, but was overshadowed by the shortage of civility and good manners.

[tharae]

<script type='text/javascript'>window.mod_pagespeed_start = Number(new Date());</script>

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

Please advise which mines were bought by the Chinese and when.

[smedly]

<script type='text/javascript'>window.mod_pagespeed_start = Number(new Date());</script>

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

Please advise which mines were bought by the Chinese and when.

do you have google on your computer ? don't even know why I'm doing this for you

http://www.theaustralian.com.au/subscribe/news/1/index.html?sourceCode=TAWEB_WRE170_a&mode=premium&dest=http://www.theaustralian.com.au/business/mining-energy/chinese-leads-the-way-in-resources-buy-ups/story-e6frg9df-1226707883067?memtype=anonymous

http://www.wsj.com/articles/SB10001424052748703724104575379203283575596

[morrobay]

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.

The only people who would call the above a conspiracy ( BOT buying/propping up the baht for the benefit of the very wealthy elite ) are those that do not accept facts that conflict with their mindset on this subject By the way exports make up 70% of Thai GDP and I just saw above that 80% of exports are paid with U.S. dollars.

Edited April 24, 2015 by morrobay

[tharae]

<script type='text/javascript'>window.mod_pagespeed_start = Number(new Date());</script>

<script type='text/javascript'>window.mod_pagespeed_start = Number(new Date());</script>

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

Please advise which mines were bought by the Chinese and when.

do you have google on your computer ? don't even know why I'm doing this for you

http://www.theaustralian.com.au/subscribe/news/1/index.html?sourceCode=TAWEB_WRE170_a&mode=premium&dest=http://www.theaustralian.com.au/business/mining-energy/chinese-leads-the-way-in-resources-buy-ups/story-e6frg9df-1226707883067?memtype=anonymous

http://www.wsj.com/articles/SB10001424052748703724104575379203283575596

If you're going to make a statement then it is up to you to back it up. Which you haven't. IO is being shipped to China in record volumes. The reason why the price of IO has dropped is due to a supply glut and a fall in demand. Economics 101.

http://www.smh.com.au/business/price-drop-signals-the-end-of-the-iron-ore-age-20140912-10fxr7.html

http://www.miningaustralia.com.au/news/could-iron-ore-drop-to-$us30-a-tonne

[JAG]

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.

Im a simple soul who understands little about money, other than the fact that I never seem to have enough of the stuff.

The suggestion that maintaining the Baht at an artificially strong level to benefit a few, wealthy and therefore well connected and influential people doesn't somehow seem that improbable.

[smedly]

<script type='text/javascript'>window.mod_pagespeed_start = Number(new Date());</script>

<script type='text/javascript'>window.mod_pagespeed_start = Number(new Date());</script>

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

Please advise which mines were bought by the Chinese and when.

do you have google on your computer ? don't even know why I'm doing this for you

http://www.theaustralian.com.au/subscribe/news/1/index.html?sourceCode=TAWEB_WRE170_a&mode=premium&dest=http://www.theaustralian.com.au/business/mining-energy/chinese-leads-the-way-in-resources-buy-ups/story-e6frg9df-1226707883067?memtype=anonymous

http://www.wsj.com/articles/SB10001424052748703724104575379203283575596

If you're going to make a statement then it is up to you to back it up. Which you haven't. IO is being shipped to China in record volumes. The reason why the price of IO has dropped is due to a supply glut and a fall in demand. Economics 101.

http://www.smh.com.au/business/price-drop-signals-the-end-of-the-iron-ore-age-20140912-10fxr7.html

http://www.miningaustralia.com.au/news/could-iron-ore-drop-to-$us30-a-tonne

so now you are giving me instructions lol

are you for real stay off the yogurt

[Time Traveller]

_{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}

Not really sure what you mean by "still so high". It's likely a case of mean reversion.

As you used the AUD as a reference, I'd suggest that it's a case of the AUD being so high that you thought it was normal to be getting 33 baht.

In the period of mid 1990's to 2005 - the AUD spent most of the time between 18 to 24 baht. The fact that you recently - in the last say 5 years - were getting 33 baht is likely just a one time fortunate event for you and that the 23 baht level is the longer term average.

I beleive this is the same with Baht against other currencies. People talk about the baht being so strong now, but the truth may be that it was the baht that was so weak before that people were fooled in to thinking that was a normal level for the baht. Now as the Baht rebounds from it's prior weakness people are asking why the Baht is so strong. (And this is kind of more like a USD story as well since the the same people complaining about Baht strenght are also seeing their currencies decline against the dollar)

Finally, just one thing I'd like to ask is why I never hear any Japanese complaining when the Yen is weaker? It's always the same people from Europe, from UK, from Australia.

Edited April 24, 2015 by Time Traveller

[Time Traveller]

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.

TT:

When one attacks the poster, the post seems to be more of a personal assault and the intellectual merit is diminished.

It is hard for some to leave out the "you's", "your's". The name calling (nutter) and questioning someones financial status is ineffective and self-defeating.

The post did have some merit, but was overshadowed by the shortage of civility and good manners.

What would you call making an accusation with no proof? I call that garbage. That's what a court judge would call it as well.

[smedly]

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.

TT:

When one attacks the poster, the post seems to be more of a personal assault and the intellectual merit is diminished.

It is hard for some to leave out the "you's", "your's". The name calling (nutter) and questioning someones financial status is ineffective and self-defeating.

The post did have some merit, but was overshadowed by the shortage of civility and good manners.

What would you call making an accusation with no proof? I call that garbage. That's what a court judge would call it as well.

I'd like to make a garbage comment right here but I won't.

This is not a court, it is a forum were people share views and opinions about a particular topic, sometimes they may post a fact with evidence, your failure to understand this distinction is shocking

If you want to talk about garbage then go create your own thread in the general forum and discuss it with yourself

[Ballbearing]

_{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}

Not really sure what you mean by "still so high". It's likely a case of mean reversion.

As you used the AUD as a reference, I'd suggest that it's a case of the AUD being so high that you thought it was normal to be getting 33 baht.

In the period of mid 1990's to 2005 - the AUD spent most of the time between 18 to 24 baht. The fact that you recently - in the last say 5 years - were getting 33 baht is likely just a one time fortunate event for you and that the 23 baht level is the longer term average.

I beleive this is the same with Baht against other currencies. People talk about the baht being so strong now, but the truth may be that it was the baht that was so weak before that people were fooled in to thinking that was a normal level for the baht. Now as the Baht rebounds from it's prior weakness people are asking why the Baht is so strong. (And this is kind of more like a USD story as well since the the same people complaining about Baht strenght are also seeing their currencies decline against the dollar)

Finally, just one thing I'd like to ask is why I never hear any Japanese complaining when the Yen is weaker? It's always the same people from Europe, from UK, from Australia.

TT,

I hope you are wrong as my nest egg is shrivelling daily.

I did a quick check on XE for the past 10 years and the AU$ was over 30 TBH in 2005, 2008, 2009, 2011, 2012 & 2014 so I would think a 27/28 average would be a bit more likely.

[morrobay]

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.

The only people who would call the above a conspiracy ( BOT buying/propping up the baht for the benefit of the very wealthy elite ) are those that do not accept facts that conflict with their mindset on this subject By the way exports make up 70% of Thai GDP and I just saw above that 80% of exports are paid with U.S. dollars.

Edit: I meant: the only people who would not call the above a conspiracy ...

[chiang mai]

This thread seems short on facts, proof and supporting links, sems to be about individual hopes and wishes more than anything else, shame really.

[micmichd]

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.

The only people who would call the above a conspiracy ( BOT buying/propping up the baht for the benefit of the very wealthy elite ) are those that do not accept facts that conflict with their mindset on this subject By the way exports make up 70% of Thai GDP and I just saw above that 80% of exports are paid with U.S. dollars.

Edit: I meant: the only people who would not call the above a conspiracy ...

Wow! Can you do some painting on your Boolean Algebra?

[micmichd]

http://www.tradingeconomics.com/thailand/exports

Looks quite stable to me.

Some data may depend on season or length of month, I don't know.

My personal problem is the decline of EUR, but that's not topic here.

Edited April 24, 2015 by micmichd

[Thai at Heart]

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 ?

It means that the short term future for the Aussie economy isn't as strong as it was. The value of its exports will suffer going forward so, the currency depreciates...

[lostoday]

. Remember AFAIK the Thai Baht rate is based on a basket of currencies with the US$ obviously being the largest.

In March 1978, the exchange rate regime was changed from one that was pegged to the U.S. Dollar to a system of pegging to a weighted basket currency of Thailand's major trading partners. The Effective Rate was established and the Baht's link to U.S. Dollar was broken. Afterwards, the Effective Rate was placed a controlled and was allowed to float within a limited range (Controlled Floating Rate). Between the years 1984 and 1990, the basket of currencies was revised for twice and composed of 10 currencies of Thailand's major trading partners. During the period of 1984-1997, the Exchange Equalization Fund (EEF) defended the Baht value against the U.S. Dollar by using some monetary and financial measures in line with the pegged exchange rate regime.

Since 2 July 1997, Thailand has adopted the managed-float exchange rate regime, of which the value of the Baht is determined by market forces. The Bank of Thailand would intervene in the market only when necessary, in order to prevent excessive volatilities and achieve economic policy targets. The floating regime enhances flexibility and efficiency in monetary policy implementation and increases confidence of domestic and international investors.

http://intl.econ.cuhk.edu.hk/exchange_rate_regime/index.php?cid=2

[lostoday]

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.

Between the years 1984 and 1990, the basket of currencies was revised for twice and composed of 10 currencies of Thailand's major trading partners. .....

Since 2 July 1997, Thailand has adopted the managed-float exchange rate regime, of which the value of the Baht is determined by market forces. The Bank of Thailand would intervene in the market only when necessary, in order to prevent excessive volatilities and achieve economic policy targets. The floating regime enhances flexibility and efficiency in monetary policy implementation and increases confidence of domestic and international investors.

http://intl.econ.cuhk.edu.hk/exchange_rate_regime/index.php?cid=2

[lostoday]

Thailand got rid of the basket of currencies in 1997.

[pattayasnowman]

Thailand got rid of the basket of currencies in 1997.

Tue Dec 4, 2007 (Reuters) - Thailand has quietly abandoned the managed floating exchange rate of the baht it adopted in 1997 and reverted to the old system of a basket of currencies, the Nation newspaper reported on Tuesday...........

Now using a basket of currencies, the BoT was managing the baht through a weighted average of movements of the major currencies in Thailand's foreign exchange reserves, it said.

It quoted a foreign exchange expert as saying the Thai reserves of more than $100 billion were held 60 percent in dollars, 30 percent in euros and 10 percent in yen.

Although the number of different curriences now held on Foreign Reserve may have increased since 2007 the weighting is still heavily with the US$ and is reported in US$

That the Thai Baht is 'effectively" pegged to the US$ is self evident - How else do you account for the rapid depreciation of most of the worlds major currencies over the past year to the US$ yet the Baht continues to trade in a narrow Range between 32 -33?

[Prbkk]

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 BOT needs be be much clearer about where it wants the baht to be. They need to say clearly, unequivocally "it's too high and must be moderately weaker". Your scenario might have some credibility in the VERY short term but in the context of weakening exports, serious prospect of sanctions/boycotts/backlash re fishing, human rights, political issues, uncertainty over the direction of tourism, it's hard to see ANY justification for the strength of the Baht. The 'hot' foreign money has gone but the relatively high interest rates are not helping any suggestion of a strategy to waeken.

Every other export economy is trying to get currencies down, Thailand needs to join the party or suffer much longer term pain.

Edited April 24, 2015 by Prbkk

[lostoday]

Thailand got rid of the basket of currencies in 1997.

Tue Dec 4, 2007 (Reuters) - Thailand has quietly abandoned the managed floating exchange rate of the baht it adopted in 1997 and reverted to the old system of a basket of currencies, the Nation newspaper reported on Tuesday...........

Now using a basket of currencies, the BoT was managing the baht through a weighted average of movements of the major currencies in Thailand's foreign exchange reserves, it said.

It quoted a foreign exchange expert as saying the Thai reserves of more than $100 billion were held 60 percent in dollars, 30 percent in euros and 10 percent in yen.

Although the number of different curriences now held on Foreign Reserve may have increased since 2007 the weighting is still heavily with the US$ and is reported in US$

That the Thai Baht is 'effectively" pegged to the US$ is self evident - How else do you account for the rapid depreciation of most of the worlds major currencies over the past year to the US$ yet the Baht continues to trade in a narrow Range between 32 -33?

You are in error as you are reading one article posted from 2007 in the wrong way. Try to find another article that supports your view that the baht is dependent on a basket of currencies.

The Thai baht is not dependent on the US dollar. It is quoted in US dollars as are all other currencies. Big difference.

The baht like all other currencies is quoted in terms of USD because the USD is the world's reserve currency.

It stays in the range it does as a result of the BOT buying and selling as appropriate to maintain that range.

The other currencies depreciated against the dollar for different reasons depending on the country. Oil, mining, trade and many factors.

Perhaps some basic reading on currency trading would be in order.

[billphillips]

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 ?

It means that the short term future for the Aussie economy isn't as strong as it was. The value of its exports will suffer going forward so, the currency depreciates...

I like the last paragraph of this post. It's quite true ... The Ausie future does not look exactly bad but, shall we say, not really promising. The result is that the currency is not rated as a good buy, so no one (at least not many) buys.

The same could be said about Thailand .. Bad recent history, uncertain political future, tourism down, exports down and masses of bad press worldwide. But lo and behold the Baht is as strong as ever, someone is buying Baht BIG time. Perhaps the BOT?

[chiang mai]

Thailand got rid of the basket of currencies in 1997.

Tue Dec 4, 2007 (Reuters) - Thailand has quietly abandoned the managed floating exchange rate of the baht it adopted in 1997 and reverted to the old system of a basket of currencies, the Nation newspaper reported on Tuesday...........

Now using a basket of currencies, the BoT was managing the baht through a weighted average of movements of the major currencies in Thailand's foreign exchange reserves, it said.

It quoted a foreign exchange expert as saying the Thai reserves of more than $100 billion were held 60 percent in dollars, 30 percent in euros and 10 percent in yen.

Although the number of different curriences now held on Foreign Reserve may have increased since 2007 the weighting is still heavily with the US$ and is reported in US$

That the Thai Baht is 'effectively" pegged to the US$ is self evident - How else do you account for the rapid depreciation of most of the worlds major currencies over the past year to the US$ yet the Baht continues to trade in a narrow Range between 32 -33?

"Managed float" and "basket of currencies" are not mutually exclusive terms, a floating currency has to be managed against something other than desire and hope, so it is that THB's float is managed against a basket of currencies!

[micmichd]

Prbkk:

Please don't try to define what Thailand needs.

The currency disaster is the economic crisis of ex-Imperialistic Europe, those countries who have lost their colonies that they built their wealth on.

Why should Thailand care about a welfare system that Europe isn't able to manage?

Why should Thailand care about possible hunger revolts in Europe?

[thailand49]

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.

First I'm not struggling in any matter shape or form. I hear people like you who talk with all the status to pump your intel up to other by citing all the economic indicators and stuff Anyone who actually live here and see the bigger picture knows lots of stuff is just smoke and mirrors.

I hear guys like you each morning about economics yet they are staying in flea bags places and too cheap to buy more than 1 drink for a girl! Most of the stuff they throw out does not apply in the real world of Thailand. What is garbage is the book worm stuff you preach anyone with any brains can see there is some manipulation. I heard this great economist one morning over coffee, maybe it was you, that touted the baht was going to be 26-1 USD?

What I do know aside from all the B.S. you throw out.is when the baht was weak someone in government complaints and it soon gets stronger, When it is too strong someone in government complaints and it gets weaker. In the end, I keep all my assets in the States, gladly pay the ATM fees keep just enough to take care of business. Each year when I apply for my extension their jaws drop and that all comes from my so call economics investment at home.

[micmichd]

You're not doing any investments in Thailand?

[thailand49]

For the record, I'm not saying anyone has the ability to totally control the rate, as we been hearing the market does for by itself. I hear all the facts people loud and clear but in the real world of Thailand, it seems funny whenever it starts to affect someone in a negative way in government all of a sudden something funny happens here.

Last, I would also like to add " There is no corruption what so ever in Thailand "

Good day boys!

[lostoday]

I don't know why you guys figure no one controls currency. The Swiss controlled theirs till a few months ago and the Thais controlled theirs till 1997. Happens all the time.

[Langsuan Man]

BOT admits Thai baht continued to appreciate

Seriously, this is like the weather department admitting that it rained when any fool can look out the window and see it raining