Baht likely to fall to 36.75 baht per US dollar at year-end

[Mudcrab]

"Due to uncontrollable external factor", Heres me thinking it

was more an internal factor,well its always someone or somethings

fault.

regards worgeordie

Yes, but Thais will never admit that something they did wrought havoc on the economy, whatever it was.

It's always be the foreigners, and usually the westerners who don't understand Thai culture.

The problem is that they do understand and they don't swallow the BS. That's the real problem in a nutshell.

Some hard lessons coming.

OK I'll bite, what was it that Thailand did that wrought havoc with the economy and why was the current fall in value of THB their fault?

how abut the overthrow of two freely elected governments! also the curtailment of civil liberties? the stop and frisk of foreigners? the "tea"money expected if you get stopped for any reason? the list goes on!

Feel free to continue with your list to keep us all amused.

[Monkeyrobot]

Why is the U.S. Getting stronger? When will they start paying back the Trillions they owe.

[Thai at Heart]

"Due to uncontrollable external factor", Heres me thinking it

was more an internal factor,well its always someone or somethings

fault.

regards worgeordie

The USD versus the baht rate is 95% controlled by the USA. It is David versus goliath in terms of size of economy and economic power.

The USA has been warned that they will cause massive shockwaves in Asia if they raise interest rates. It has to happen sometime. It's 7 years since the crisis and now is as good a time as any.

Postponing these issues is what caused the problem in the first place. China's continued holding of its exchange rate at below market value exported cheap debt to the USA starting this whole mess in the first place.

They would be crazy to postpone raising rates in the USA too long. You can't buck the market forever.

[Thai at Heart]

Yes, but Thais will never admit that something they did wrought havoc on the economy, whatever it was.

It's always be the foreigners, and usually the westerners who don't understand Thai culture.

The problem is that they do understand and they don't swallow the BS. That's the real problem in a nutshell.

Some hard lessons coming.

OK I'll bite, what was it that Thailand did that wrought havoc with the economy and why was the current fall in value of THB their fault?

Banks said Oct 2014 - TMB Bank plc, formerly known as Thai Military Bank, reckons the moment Thais will confidently dip into their spending money is just around the corner and that it will produce a “V-shaped” recovery. Economists at Siam Commercial Bank, also see a nice pick-up around the corner, with the economy returning to its potential of around 4.5% in 2015. And the Bank of Thailand, the central bank, agrees that things will soon improve.

Ask economists at the World Bank (which stopped lending to Thailand long ago because the country had become too rich) and the answer is different.

It surprises no one that Thailand’s economy has performed poorly over the past year. The country has suffered six months of political agitation; the absence of a proper government capable of handling fiscal policy since the end of 2013, when the prime minister at the time, Yingluck Shinawatra, dissolved parliament; and then a military coup in May.

An empirical analysis of the impact of coups on other national economies shows that growth slows, on average, by 2.1 percentage points in the year of a coup, 1.3 and 0.2 in the first and second year after the coup.

http://www.economist.com/blogs/banyan/2014/10/thailands-economy

So, there is your answer.

If you would like to know how to increase the GDP and the value of the baht it is no problem but I charge for that information. PM me for rates. PS I give a discount for democracies.

Sorry but no, that's not a viable answer.

You start off by taking a shot at how poorly some Thai banks have forecast recovery in the Thai economy, a sin not suffered by banks in other economies of course, ahem! And then you talk about the World Bank having a different answer, whatever that might be! Reminds me somewhat of Christine Laggard forecasting that the economy of UK Plc would hit the skids, only to offer a grovelling apology two months later.

But then to the probable crux of what you've written, the reason the Thai economy is in the doldrums is because of the coup and this has been proven by studies of the economies of other countries post coup. Oh really!

History has shown that "political agitation" has had no lasting impact whatsoever on the Thai economy, even when there were tanks in the streets and snipers shooting people in temples, the economy remained robust, and as a bi-product, so did the currency.

I'm afraid matey that you've missed it all by a wide margin here, but I understand that it's just so easy to blame the coup or indeed, bash Thailand. Had you said a combination of capital outflows resulting from the US rate picture and a slow down in the Chinese (and global) economy were to blame I could have agreed with you and given you a like, as it stands I I'm headed in the opposite direction.

The USD has been artificially weak since it has been coming out of the 2008 crisis. Time has passed and USA is looking better, so rates will rise.

This is the end of the 2008 crisis finally happening and weaning markets off QE is going to cause some shocks. China started all this 15 years ago by pegging their rate too low too long.

Once the bottle popped in the USA after cheap borrowing for so long, the world has reaped the whirlwind now for 7 years.

[Eric Loh]

Does anyone really believe the Fed will do a rate rise this September?

Jury still out there. USA economy improving but not great. The employment gains really not up to expectation. There really no inflation at the moment and a strong dollar is bad for the exporters at time when other competing countries have a weak currency and global demand is still very soft. Doubt September and possibly kick the can to next year.

[pmugghc]

"Due to uncontrollable external factor", Heres me thinking it

was more an internal factor,well its always someone or somethings

fault.

regards worgeordie

If you'd bother to check other ASEAN and EM currencies you'd see they've all lost vs the USD. But why skip a chance to do some old fashion Thai bashing?

[pmugghc]

"Due to uncontrollable external factor", Heres me thinking it

was more an internal factor,well its always someone or somethings

fault.

regards worgeordie

Yes, but Thais will never admit that something they did wrought havoc on the economy, whatever it was.

It's always be the foreigners, and usually the westerners who don't understand Thai culture.

The problem is that they do understand and they don't swallow the BS. That's the real problem in a nutshell.

Some hard lessons coming.

When they become a full member of ASEAN a lot of very hard lessons will come

Get your facts straight: Thailand has been a full member of ASEAN since 1967. If you lack such basic knowledge better not post such nonsense! Edited September 9, 2015 by pmugghc

[Skeptic7]

YAY...About effin' time! The baht has remained inexplicably strong through 2 military coups, constant political unrest, violent protests, airport shutdown, floods, drought, Bangkok Shutdown, bombs, etc. I'm happy the baht is finally finding a more reasonable and proper level. Would love to see it get to ß40:$1 again. GO GO!

Edited September 9, 2015 by Skeptic7

[waldroj]

According to Trading Economics, Thailand recorded a trade surplus of 770.45 USD Million in July (http://www.tradingeconomics.com/thailand/balance-of-trade)!

As Thailand is an Export-oriented country, then (if it can withstand the "uncontrollable external factor" [X-factor]) would not a lower Baht be an opportunity for local exporters - who presumably pay taxes proportionate to their earnings?.

The lower Baht would certainly be a bonus for the Tourism Industry (which, if you ignore the propaganda) seems to be in need of a revamp.

[Skeptic7]

Does anyone really believe the Fed will do a rate rise this September?

Jury still out there. USA economy improving but not great. The employment gains really not up to expectation. There really no inflation at the moment and a strong dollar is bad for the exporters at time when other competing countries have a weak currency and global demand is still very soft. Doubt September and possibly kick the can to next year.

Almost certainly will raise this month. 25 basis points, from nearly zero for years now, won't even be noticed and is long overdue. Even if they raised it 50 basis points, which they won't...it would still be historically very low. A hike will bring some stability back to the markets and also prepare for further rate hikes next year. Then watch the baht crumble!

[Baerboxer]

There are some folk who just will not acknowledge that a very poor quality government and it's extremely poor management of the economy can cause a slide, both in the value of the currency and the numbers of its economic performance generally, as reported by much more cl;ever people than me, who do so for a living.

If it wasn't at least in part due to this useless government, then perhaps it was magic? Voodoo? The fireball? Maybe we should all jog on down to the wat and make a nice bit of merit.

Hard to believe.

They need lessons from the last government eh Jon?

How do you manage inflation when everyone's complaining of rising food prices? Easy, send Yingluck to do some shopping, with the media of course. She then announces prices haven't really gone up and it's just the hot weather making people imagine they have.

Or fail, as a government, to keep meaningful transparent on government spending, off budget spending, and special schemes; or keep them but make sure they're top secret.

Thailand - a sufferer of useless successive governments.

[stoli]

These notices of the US Fed raising interest rates will be built into speculation, and the baht will rise as a result, prior to September 16. If you believe, that the US Fed will raise interest at this time, wait to exchange your US dollars. If you think the US Economy is still in the toilet, and that the US Fed will not raise interest rates, convert your US Dollars to Baht on September 15th. Every time, for the last 2 years, when the Fed meets, the dollar get stronger against the baht, only to fall the next day, because they have not changed the interest rate. Not once. What do you speculate will happen September 16th. What will the price of gold be tomorrow. Always a guess. Even the weather forecasters are correct only 50% of the time. Not very good.......

[Daniel Boon]

with deference to all ... world economic manipulation is the name of the game; stripping value wherever they can

in my opinion, corporate America has an end goal and that is to rip everyone off, but taking 'real money' and replacing it with their play money, the greenback. By printing it until it could - if it were in notes - cover Thailand a foot deep and have no value whatsoever and those in the game realizing if they acknowledge it, they will receive nothing, still play the game.

There has to be more than $20 trillion USA $ in play, far more than there is actual supportable assets world wide.

Currency is an agreed IOU for future earning by way of personal exertion = energy; money is supposed to equal energy; however, Planet Earth does not have that energy available. The only way to keep the chain letter in play, is to get people to buy into or stay in the game, abd the system keeps buying some of its worthless stocks to give the appearance things are still happening.

That's why the more obscure and harder to get to (fossil fuel) energy is being pursued ...

the reality is that everything has a carrying capacity, be it a bicycle, motorcycle, car, bus, train, plane; building, boat, glass, clothing ... in weight and volume ... and Earth's carrying capacity has been exceeded; an exemplar of this is the spike in refugees around the world ... the rich have removed so much energy / money from the system that the remainder have nothing to trade with ... which brings us back to currency of any country and their energy 'assets' or resources to stay in th game.

Australia is going down the gurgler, with the LNP political party openly and blatantly moving funding away from the people and to the corporations ... however, their stupidity - articulated in their modus operandi - is that the money they have removed from the system, the average consumer can spend no more, as the work opportunities dry up and their ability to exchange labour energy for currency ..

[phoenixdoglover]

Hmmm. Judging by the trend, I'm with the other members who are predicting something closer to 40 baht to the dollar.

I don't see the substantial action by the current government that will forestall this. Also, I don't think the current government has many levers to pull. Junta or no junta, I would not like to be Finance Minister right now.

[chiang mai]

I don't know the detail, but was under the impression that Thailand was *intentionally* going to devalue the baht.

Fed doing rate rise, I don't know how they can. I think they'd like to, but the system is in such a state that I'm not sure it could accommodate it.

How would Thailand intentionally devalue the baht?

In the same way any country devalues their currency, sell it and buy USD! If you were paying attention to the foreign currency reserves at BOT these past two years you will have noticed that the FCY reserves increased whilst BOT attempted to weaken THB. Which of course is the exact opposite of what is happening now in that BOT is trying to smooth out and slow the decline of THB and to periodically strengthen it, ergo the FCY reserves are reducing, along with all the other central bank reserves in SE Asia.

[Mudcrab]

Billary and the Trump have no idea of the talent they are missing on TV....could have the 14 trillion dollar black hole sorted in no time

[lostoday]

Does anyone really believe the Fed will do a rate rise this September?

Jury still out there. USA economy improving but not great. The employment gains really not up to expectation. There really no inflation at the moment and a strong dollar is bad for the exporters at time when other competing countries have a weak currency and global demand is still very soft. Doubt September and possibly kick the can to next year.

Almost certainly will raise this month. 25 basis points, from nearly zero for years now, won't even be noticed and is long overdue. Even if they raised it 50 basis points, which they won't...it would still be historically very low. A hike will bring some stability back to the markets and also prepare for further rate hikes next year. Then watch the baht crumble!

Certainly will not raise this month. Come back in a few weeks and admit you were wrong.

[Zzon]

Now that's a fancy word "empirical" ... As long as they have corruption no matter what government comes in next there will be backlash and protests and that's why the Economy is going to crash!

[Shawn0001]

I don't know the detail, but was under the impression that Thailand was *intentionally* going to devalue the baht.

Fed doing rate rise, I don't know how they can. I think they'd like to, but the system is in such a state that I'm not sure it could accommodate it.

How would Thailand intentionally devalue the baht?

In the same way any country devalues their currency, sell it and buy USD! If you were paying attention to the foreign currency reserves at BOT these past two years you will have noticed that the FCY reserves increased whilst BOT attempted to weaken THB. Which of course is the exact opposite of what is happening now in that BOT is trying to smooth out and slow the decline of THB and to periodically strengthen it, ergo the FCY reserves are reducing, along with all the other central bank reserves in SE Asia.

"In the same way any country devalues their currency, sell it and buy USD!"

The other ways being printing more money and reducing interest rates.

[Zzon]

Now that's a fancy word "empirical" ... As long as they have corruption no matter what government comes in next there will be backlash and protests and that's why the Economy is going to crash!

[elgordo38]

OK so its the USA's fault again for the weakening baht. I will have to tell then embassy to keep up the good work then because it is making me rich changing dollar to baht now. Heheee

I am predicting 39 by years end and you can take that to the bank. 43 by the end of next year. If they do not join the race to the bottom the rest of Asia will pass them by. Most of Asia is in this race. Eventually paper money will be baseless.

[Jon Wetherall]

There are some folk who just will not acknowledge that a very poor quality government and it's extremely poor management of the economy can cause a slide, both in the value of the currency and the numbers of its economic performance generally, as reported by much more cl;ever people than me, who do so for a living.

If it wasn't at least in part due to this useless government, then perhaps it was magic? Voodoo? The fireball? Maybe we should all jog on down to the wat and make a nice bit of merit.

Hard to believe.

They need lessons from the last government eh Jon?

How do you manage inflation when everyone's complaining of rising food prices? Easy, send Yingluck to do some shopping, with the media of course. She then announces prices haven't really gone up and it's just the hot weather making people imagine they have.

Or fail, as a government, to keep meaningful transparent on government spending, off budget spending, and special schemes; or keep them but make sure they're top secret.

Thailand - a sufferer of useless successive governments.

"They need lessons from the last government eh Jon?"

Not really friend, they need lessons from history.

"How do you manage inflation when everyone's complaining of rising food prices? Easy, send Yingluck to do some shopping, with the media of course. She then announces prices haven't really gone up and it's just the hot weather making people imagine they have."

A bit like the army handing out cheap meals then? And now of course you complain that they didn't think of it first. No pleasing some folk.

"Or fail, as a government, to keep meaningful transparent on government spending, off budget spending, and special schemes; or keep them but make sure they're top secret."

All according to the interlopers who illegally snatched power from the elected government of thee day. Of course, we should all believe that yes? And the thing about vote-buying?

[Jon Wetherall]

OK so its the USA's fault again for the weakening baht. I will have to tell then embassy to keep up the good work then because it is making me rich changing dollar to baht now. Heheee

I am predicting 39 by years end and you can take that to the bank. 43 by the end of next year. If they do not join the race to the bottom the rest of Asia will pass them by. Most of Asia is in this race. Eventually paper money will be baseless.

Well, look on the bright side. At least some of the quality tourists will come back. Maybe.

[SunLover2]

This is the kiss of death. I recall reading a recent TV article that said the Baht will not to weaken past 35.00 per the USD. Now for sure it will not happen.

SunLover

[Stevemercer]

Do Americans really want such a high dollar? Surely the American economy depends on some exports to the rest of the world? Or can the Americans just keep sucking in cheaper and cheaper imports (presumably displacing American products) without a hitch? How high does America want its dollar to go? Double what it is now?

[Shawn0001]

Baht likely to fall from 36 to 75 baht per US dollar at year-end

[lostoday]

Do Americans really want such a high dollar? Surely the American economy depends on some exports to the rest of the world? Or can the Americans just keep sucking in cheaper and cheaper imports (presumably displacing American products) without a hitch? How high does America want its dollar to go? Double what it is now?

What does the price of the dollar have to do with what Americans want? It's not like they elect the Chairman of the Fed.

[Skeptic7]

Does anyone really believe the Fed will do a rate rise this September?

Jury still out there. USA economy improving but not great. The employment gains really not up to expectation. There really no inflation at the moment and a strong dollar is bad for the exporters at time when other competing countries have a weak currency and global demand is still very soft. Doubt September and possibly kick the can to next year.

Almost certainly will raise this month. 25 basis points, from nearly zero for years now, won't even be noticed and is long overdue. Even if they raised it 50 basis points, which they won't...it would still be historically very low. A hike will bring some stability back to the markets and also prepare for further rate hikes next year. Then watch the baht crumble!

Certainly will not raise this month. Come back in a few weeks and admit you were wrong.

No problem admitting when wrong, but since you're the one making the positive claim...TV members following this thread will expect full admittance of your error if you prove to be incorrect. Looking forward to it...

Edited September 9, 2015 by Skeptic7

[Pib]

Do Americans really want such a high dollar? Surely the American economy depends on some exports to the rest of the world? Or can the Americans just keep sucking in cheaper and cheaper imports (presumably displacing American products) without a hitch? How high does America want its dollar to go? Double what it is now?

The U.S. economy is predominately "domestically" driven...only 13.5% of the U.S. GDP is exports in comparison to Thailand which is 73% export driven. A strong dollar makes imports cheaper.

See the webpage which shows Exports as Share of a GDP. Link

[fish fingers]

I'd never predict rates more than a year ahead .. but yes, the thai economy is in bad shape.

Major events can trigger confidence one way or the other. At some point the baht will fall in value massively but forums rules mean I can't say why.