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Thai baht expected to stay 34/$ for now

webfact

By webfact
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webfact Grand Master Member

webfact

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Baht expected to stay 34/$ for now
ERICH PARPART
THE NATION

30264057-01_big.jpg

BANGKOK: -- THE WEAKER baht is helpful to Thai exporters but the slowdown in global demand remains a problem, and the woes in the euro zone surrounding the Greek debt crisis will worsen this factor, said Supant Mongkolsuthree, chairman of the Federation of Thai Industries.

The baht has sunk to its weakest level in six years as the escalation of Greece debt crisis has triggered a flight to safe-haven assets, which has contributed to the strengthening of the US dollar. The baht closed at 34.004 per dollar yesterday.

"The Greek debt situation has [contributed to] depreciation of the baht but global demand is still low. The uncertainty over a 'Grexit' means that the demand from European Union and other countries will continue to be weak as |people are still waiting to see whether the EU will be able to cope with their latest financial trouble," he said.

Supant said an exchange rate around Bt34 per US dollar would provide a good balance between export and investment, as exporters can sell more product while investors are not too bothered by a depreciation of around 1-2 per cent.

He expects the baht to remain in the 34-35 range as he believes that the dollar will strengthen towards the end of the year.

Pongtharin Sapayanon, head of fixed income at Aberdeen Asset Management, said the escalation of Greece's debt situation had contributed to the strengthening of the US dollar, and that was the main reason the baht depreciated yesterday. Domestic factors such as the Bank of Thailand's monetary policy were secondary.

"The BOT is using the policy interest rate and the exchange rate as tools to create traction for growth, since the wheels are spinning but the economic expansion is still not going where it was expected to be," he said.

The baht deprecated in the second quarter more than Aberdeen had expected, but it still maintains its forecast that it will be in the 34-34.5 region by the end of the year.

Factors behind depreciation

Tim Leelahaphan, Thailand economist at Maybank Kim Eng Securities, said the consecutive cuts in the policy rate in the first half of the year and the central bank's earlier move to relax foreign-exchange regulations were still contributing to the deprecation of the baht. Meanwhile the flow of funds to safe havens initiated by the Greek debt situation has contributed to the strengthening of the US dollar and the Japanese yen.

"Global [fretting] caused by Greece and the bleak outlook of China's capital market yesterday [gave more impetus to] the flow to safe havens that has been going on since Monday," he said.

He expects the baht to weaken to around 34.5 by the end of this quarter or when the US Federal Reserve raises its key interest rate in September.

He said the baht should strengthen towards the end of the year to 34 as Thailand enjoys a tangible recovery in the fourth quarter.

Source: http://www.nationmultimedia.com/business/Baht-expected-to-stay-34$-for-now-30264057.html

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-- The Nation 2015-07-09

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Can anyone comment if the Baht is weakening against currencies other than the US Dollar?

.

I can, but I will not .. since you posted this .. obviously, your internet connection is sound, and your computer works.

Who ARE you slack arse lazies who can not goggle your own information?

Signed "Ain't your bitch"

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Srikcir Ruby Member

Srikcir

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Likely to top out at 35/$ by year-end.

BUT

The rate for 2016 will still be in the "Danger Zone" due to political uncertainty, continued failure of the government to prop up agricultural prices, invest in infrastrucure, added national debt for foreign loans, increasing household debt, stagnant world demand for agricultural commodities, real estate bust in China, etc. Thailand's new trade agreements with Russia and China will not be Thailand's economic "White Knights" as it hoped.

Then there is the potential ban of seafood products by the EU and USA, and many unpredictable global events that can further stress the Thai economy.

The government should make very cautious economic actions that balances available capital with market demand and austerity. Government expenditures that do not promote GDP growth need to cease!

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i claudius Platinum Member

i claudius

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Posted

Can anyone comment if the Baht is weakening against currencies other than the US Dollar?

.

I can, but I will not .. since you posted this .. obviously, your internet connection is sound, and your computer works.

Who ARE you slack arse lazies who can not goggle your own information?

Signed "Ain't your bitch"

I have never tried goggle ,is it any good as a search engine? smile.png

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rametindallas Platinum Member

rametindallas

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Posted

Can anyone comment if the Baht is weakening against currencies other than the US Dollar?

.

I can, but I will not .. since you posted this .. obviously, your internet connection is sound, and your computer works.

Who ARE you slack arse lazies who can not goggle your own information?

Signed "Ain't your bitch"

touche'

.

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kiwikeith Gold Member

kiwikeith

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Can anyone comment if the Baht is weakening against currencies other than the US Dollar?

.

been floating around 25 baht for AUD

The Kiwi and Aussie have weakened.

The Kiwi around 22 and Aussie 25 a few weeks back the opposite kiwi was at around 25 and Aussie a bit higher.

The Greek situation is being played as a contibuter and the money boys will be pushing currencies around while this is happening.

I think after this settles down the NZD and AUS will rebound as will other currencies.

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hugh2121 Advanced Member

hugh2121

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THB has not fallen significantly. What's happening is that as the Greek fiasco plays on, people are turning to the $US which they see as a safe haven in times of financial instability. Thus, the $US has risen against many currencies. Normal market reaction to increase price of a popular commodity.

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lifeincnx Advanced Member

lifeincnx

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THB has not fallen significantly. What's happening is that as the Greek fiasco plays on, people are turning to the $US which they see as a safe haven in times of financial instability. Thus, the $US has risen against many currencies. Normal market reaction to increase price of a popular commodity.

The baht has fallen to its weakest level since September 2009. Global investors are steadily yanking funds from local assets partly because of the rout in Chinese equities, and it's far from over. Putting it in perspective, the Shanghai composite index dropped like a rock by 32 percent this past month alone, and the benchmark SET Index closed at its lowest level this year.

Those TV posters hoping for the baht to drop to 40, etc., really need a lesson in Econ 101 as that would spell financial household disaster for the average working Thai. Or, perhaps those posters simply just don't care.

Edited by lifeincnx
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rametindallas Platinum Member

rametindallas

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Thailand Baht Sinks to Six-Year Low on Outflows Amid China Rout http://www.bloomberg.com/news/articles/2015-07-08/thailand-s-baht-sinks-to-six-year-low-on-outflows-china-concern?cmpid=yhoo

China is Thailand's second largest export market, after the US, and China's Stock Market fell 42% in the last month. That's going to sting. Investors are also nervous about the possible exit of Greece from the Euro.

.

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elgordo38 Gold Member

elgordo38

Posted
Posted (edited)

Can anyone comment if the Baht is weakening against currencies other than the US Dollar?

.

been floating around 25 baht for AUD

The Kiwi and Aussie have weakened.

The Kiwi around 22 and Aussie 25 a few weeks back the opposite kiwi was at around 25 and Aussie a bit higher.

The Greek situation is being played as a contibuter and the money boys will be pushing currencies around while this is happening.

I think after this settles down the NZD and AUS will rebound as will other currencies.

The baht cannot and will not stay immune in this world of turmoil and if the government insists on keeping it high external forces will change it for them. I think events in China are the Black Swan event that has been foretold to be coming. Markets go in cycles and we are now in the cycle where greed has drawn the small investor into the fray. As history has demonstrated this is when things fall apart and the big guy is long gone with his profits and the little guy is left holding an empty bag. When the small investor (and there are lots of them) starts to get burnt this causes panic. This is my forecast so lets see how things play out over the coming weeks and months. After all the little people are badly burnt and blood is flowing in the streets the moneyed boys step in again and the cycle repeats itself.

Edited by elgordo38
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HerbalEd Platinum Member

HerbalEd

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Posted (edited)

Maybe we should all 'goggle' our own information as suggested by Bangkokequity ?!!

His point is a valid one. Here on TV.com I often see many people asking questions that can very easily and quickly be answered by a simple google search. In fact, often the google search is faster than typing and posting the question on TV.com.

Edited by HerbalEd
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