The Baht At 6-year High Against The Us Dollar

[george]

Baht becomes strongest in 6 years

BANGKOK: -- The baht has appreciated to touch 37.10 to the US dollar on Wednesday’s trading, the strongest in six years, since there is a capital inflow into the Stock Exchange of Thailand and the greenback has weakened against other currencies, according to money dealers.

The dealer at Bangkok Bank said the baht hovered around 37.10-37.15 to the dollar at the market close, up from 37.20-37.23 on the opening bell.

He said the baht appreciation stemmed from the capital inflow into the stock market. The local currency had strengthened in the same direction with other regional currencies.

Bank of Thailand’s Governor-designate Tarisa Watanagase conceded the baht movement in a range of 37.10-37.15 to the US dollar is considered too strong.

The sharp appreciation was partly because a large amount of foreign capital had flown into Thailand. A certain amount of the capital went to the stock market.

Whether the central bank would intervene in the baht movement could not yet be confirmed, she said.

Songpol Cheevapanyaroj, an executive in charge of the capital market business group at Kasikornbank, said the baht had strengthened because the US dollar had weakened against currencies in Asia.

As well, the appreciation of the local currency stemmed from exporters’ move to dump the dollar continuously.

He said the baht movement at the end of the year needed to be closely monitored since a major flooding had affected the agriculture, which would have an impact on exports in the 3rd and 4th quarter.

--TNA 2006-10-26

Latest currency exchange rates:

http://www.thaivisa.com/exchange_rates.0.html

Currency converter:

http://www.thaivisa.com/currency_converter.0.html

[george]

Update:

Baht likely to strengthen to 37 to US dollar late this year

BANGKOK: -- The baht is projected to strengthen in the same direction with other regional currencies and stay at 37 to the US dollar at the end of this year, according to Supavud Saichua, Head of Research at Phatra Securities Public Company Limited.

He said the local currency had appreciated to 37.20 to the dollar at present due to a foreign capital inflow and the strengthening of regional currencies, particularly Chinese yuan.

The appreciation of the baht at the current level had not yet affected the country’s exports.

“Even though the baht will strengthen to 37 to the dollar late this year, it is not too strong because other regional currencies have appreciated as well,” he said.

He conceded private companies had now utilized their capacities at a very high level. Simultaneously, they had not yet made additional investment.

Should the baht continue to appreciate, the companies might need to import raw materials.

It would lead to a trade deficit and a depreciation of the baht. But the phenomenon is not worrying because it is a normal movement of the currency, he said.

--TNA 2006-10-26

[PeaceBlondie]

37 is a low number; the baht is very strong. Those of us whose pensions are in US$ will have to start drinking fewer Pepsi Max or whatever.

[richard10365]

PeaceBlondie,

I'm already stocking up on water. It's definitely a lot cheaper than Coke or Pepsi.

I'm glad the COLA (cost of living adjustment) kicks in every year for government pensions. If not, the low dollar would be killing me.

[chownah]

this change in baht to us dollar exchange rate is made up of two components...the baht strengthening...and the dollar weakening. If you want to know how much is due to strengthening of the baht then compare the baht to other currencies and see if it is strengthening there....if not then it pobably is due to the us dollar weakening.

Chownah

P.S. There is a third possibility. The baht could be being artificially propped up. I haven't a clue as to whether this is happening or not but I think not.

Chownah

[churchill]

imho The baht will continue to gradually stenghten against euro . dollar etc over the comming years as the economies in the west decline , especially the usa , and as the eastern economies strenghten .

[Naam]

USD/THB presently 36.97!

[Buckwheat]

this change in baht to us dollar exchange rate is made up of two components...the baht strengthening...and the dollar weakening. If you want to know how much is due to strengthening of the baht then compare the baht to other currencies and see if it is strengthening there....if not then it pobably is due to the us dollar weakening.

Chownah

P.S. There is a third possibility. The baht could be being artificially propped up. I haven't a clue as to whether this is happening or not but I think not.

Chownah

I thought the same thing you posted. I seem to recall the strengthing of the baht around the same time as the Shin Corp sale. Anyone confirm?

[PeaceBlondie]

PeaceBlondie,

I'm already stocking up on water. It's definitely a lot cheaper than Coke or Pepsi.

I'm glad the COLA (cost of living adjustment) kicks in every year for government pensions. If not, the low dollar would be killing me.

Yes, richard, but the SS COLA is only 3.3%, and the prices in Thailand have increased more than that. You can't drink some 'colas.'

[corkscrew]

But, remember when it was 25 to the dollar!!

[Whitey]

It is ok for those of us who are earning in baht and sending money back to the states in dollars. 25 sounds really good to me.

[deminister]

Not the Baht is strong, the Dollar is weak

[BlackArtemis]

greaaaat, right when I am bringing a down payment over for a house...

[VanZam]

Exactly... the baht has only gained most over the US dollar, just as the USD dropped over other major currencies.

[hardy1943]

Exactly... the baht has only gained most over the US dollar, just as the USD dropped over other major currencies.

The US DOLLAR REALLY HAS NOT DROPPED AGAINST OTHER CURRENCIES.

1$ = NOW about 119Yen ..........1$= NOW about 1.26 Euro 1$ = ...........37BAHT RIGHT NOW

1$= 1 1/2 Years ago...100Yen...... 1$ was about then 1.33 Euro 1$..was about then ..40BAHT

Ever since the CHINESE YUAN took the Thai Baht into it basket

the Thai Bath has been moving with the CHINESE YUAN

ALL OTHER EXPLANITIONS ARE HOG WASH

[Chopper]

That is a very narrow viewpoint 'hardy'. I would not bet money on your explanation.

[bri1guy]

Highest in 6 years? Is this correct? I thought it was over 40 just a year or two ago?

[Mamasun]

...6 months before 100 bahts = 3,12 chf...und now 100 bahts = 3,42 chf !!!

[WilliamIV]

Highest in 6 years? Is this correct? I thought it was over 40 just a year or two ago?

bri1guy

40 to the $ is LOWER value !!!

[Wonderboy]

Hardy is right. The Baht have apreciated against every currency on the planet and the last days it's gone up real fast. Was 37.40 this monday. The usd have not lost much ground to other currencies the last six months. Anyone wanting the hard facts can check http://www.oanda.com/convert/fxhistory

Wonderboy

[StevenCalifornia]

from this side of the pond, we see the decline in tourism and influx of money from over here.

daily news warns tourists about the floods and fires and the unstablility in the region. How it can go up now is an indication of manipulation. Everyone is saying "what the heck, lets do tijuana"

This flux in the economy is another red flag for tourists over here. Just my opinion based on the local talk here in california.

[tropo]

Highest in 6 years? Is this correct? I thought it was over 40 just a year or two ago?

What it means is that the baht is the strongest it's been for 6 years, buying the most dollars.

ie. 1 baht = $0.027 now (at 37)

1 baht = $0.025 before (at 40)

[tropo]

Exactly... the baht has only gained most over the US dollar, just as the USD dropped over other major currencies.

The US DOLLAR REALLY HAS NOT DROPPED AGAINST OTHER CURRENCIES.

1$ = NOW about 119Yen ..........1$= NOW about 1.26 Euro 1$ = ...........37BAHT RIGHT NOW

1$= 1 1/2 Years ago...100Yen...... 1$ was about then 1.33 Euro 1$..was about then ..40BAHT

Ever since the CHINESE YUAN took the Thai Baht into it basket

the Thai Bath has been moving with the CHINESE YUAN

ALL OTHER EXPLANITIONS ARE HOG WASH

Hardy, before you go around rubbishing others' theories you might want to check out you own figures.

Last time I looked the US $1 = 0.7807 Euro

Could you please explain this "Chinese basket theory". I'd like to know more about that.

[astral]

Not the Baht is strong, the Dollar is weak

Exactly.

US pensioners should contact their local congressman!!

[Alf Witt]

from this side of the pond, we see the decline in tourism and influx of money from over here.

daily news warns tourists about the floods and fires and the unstablility in the region. How it can go up now is an indication of manipulation. Everyone is saying "what the heck, lets do tijuana"

This flux in the economy is another red flag for tourists over here. Just my opinion based on the local talk here in california.

Sure, flooding etc. has an affect on the Thai economy, but don't you think GB's adventures in Iraq - burning billions of US dollars is weakening the US economy and is the major cause of the dollar's decline? That will prove to be both a political and economic disaster for the USA but you voted for it when you had the chance to get rid, so, som nam na.

[Naam]

But, remember when it was 25 to the dollar!!

i can still remember 20 baht to the dollar and the fact that every shop in Bangkok accepted payment in dollars when you bought something.

[sting01]

The value of a money is more based on macro economic statistics than micro.It's also more based on the accounts of the considered nation than on those of the citizens.

In layman language it could give the following :

1) Thailand have made the biggest deal ever seen with the session of Shin empire to Temasek. Keep in mind in that case the nationality of the 2 groups is not involved, but only the amount. The value before the deal and the value agrreed for the deal is also a key point. People acting on the currency market read thailand as a place where foreign currency will continue to flow in HUGE quantity and by so make the baht sronger, the result is they buy baht to be on the winning side and sell it later with a benefit.

2) Another signal for those who trade on currency market is the new governement is not loooking to implement policy to restraint foreign capital to come in thailand (As long as the amount is consequent), but is looking to simply change the how this capital was used. They are simply suposing the future new rules will allow a broadest capacity to invest on interesting sectors (currently not avalaible to invest) and they are supposing it will generate a quick divident.

3) that is the downfall, or a potential downfall, does that move to a hight value is reflecting the reality (stock market under evaluate, new policy morefriendly for big investment, new laws more lax with regardson the capacity to move eventual benefit ....) or does this move is hapening for speculative reasons? Here , that is my humble opinion, we are witnessing a monster (as stagflation was another monster for the countries in EU during the 80') because even if the bath value is hightly speculative, there is actually no concrete reasons to make it going on the other way. If Temasek/Shin deal is not cancelled, if a settlement in the ITV/governement is found, if there is not a MASSIVE exodus of foreigners (massive is a key point) with their assets to another country in the neighborought (if they move but simply go back home it will be irrelevant), the baht will stay an attractive money for the speculators/investors, because it allow to diversify your basket with actually a very fair risk. The very risk being the bath going so hight than it could slow down the economy , making goodsfrom thailand too expensive for the usual countries who buy them, and also making Thailand too much dependant on cheapest importation (by going throught the cycle of: no news fabrics, then fabrics moved abroad with only Main office in Thailand, then higher rate of jobless people and lost in the global buying power of the average thais).

Just thought, or just how I would have explain it while in university. So can be completly wrong, partially wrong, or quite accurate.

[bob/nyc]

The real problem with the strong Baht is that Thai goods will cost much more in the export market, making them less attractive, and other countries will not buy them. I am sure that the US is one of Thailands biggest trading partner. So if the Thai bankers were smart, they should be buying US Dollars to try to stabilize the dollar/baht rate. They did say once that 37 was much to strong and at that point they would intervene. So where are they ?????

[Tuschno]

from this side of the pond, we see the decline in tourism and influx of money from over here.

daily news warns tourists about the floods and fires and the unstablility in the region. How it can go up now is an indication of manipulation. Everyone is saying "what the heck, lets do tijuana"

This flux in the economy is another red flag for tourists over here. Just my opinion based on the local talk here in california.

Sure, flooding etc. has an affect on the Thai economy, but don't you think GB's adventures in Iraq - burning billions of US dollars is weakening the US economy and is the major cause of the dollar's decline? That will prove to be both a political and economic disaster for the USA but you voted for it when you had the chance to get rid, so, som nam na.

I voted for Alf.

[Alf Witt]

from this side of the pond, we see the decline in tourism and influx of money from over here.

daily news warns tourists about the floods and fires and the unstablility in the region. How it can go up now is an indication of manipulation. Everyone is saying "what the heck, lets do tijuana"

This flux in the economy is another red flag for tourists over here. Just my opinion based on the local talk here in california.

Sure, flooding etc. has an affect on the Thai economy, but don't you think GB's adventures in Iraq - burning billions of US dollars is weakening the US economy and is the major cause of the dollar's decline? That will prove to be both a political and economic disaster for the USA but you voted for it when you had the chance to get rid, so, som nam na.

I voted for Alf.

Actually, to be fair, Tuschno, most Americans I have met here or elsewhere outside the USA have been a lot wiser than those I have met in the USA. I suspect the fact that the sensible ones have left the country is not too much of a coincidence. Even non-Americans are affected by the strength/weakness of the $$ however.

Edited October 27, 2006 by Alf Witt