BOT: Yuan depreciation affects Baht slightly

  

BANGKOK, 3 November 2016 (NNT) - The Bank of Thailand (BOT) explained that the yuan six-year low depreciation is in line with market expectations due to the US dollar's appreciation, assuring that the baht will only be affected slightly. 

BOT’s Financial Market Division assistant governor Wachira Aromdee stated that, the central parity of the yuan against the US dollar during October depreciated by 1.28 percent, which is in line with earlier predictions. 

The Chinese currency's depreciation was mainly caused by the US dollar's appreciation, especially after investors are increasingly expecting that the US Federal Reserve (Fed) is likely to raise interest rates again this year. 

However, she is confident that the yuan's depreciation will not regional currencies including the baht too much. The direction of regional currencies will depend largely on the US dollar and each country's domestic factors. 

From September to October, the Thai currency depreciated by about 0.9 percent. The BOT has disclosed that the bank will be closely monitoring the global financial market.

 

-- nnt 2016-11-03

On 11/3/2016 at 7:57 AM, webfact said:

expecting that the US Federal Reserve (Fed) is likely to raise interest rates again this year. 

Beginning of November the Fed doesn't seem it necessary to raise interest rates. I expect the status quo until January 2017. It is likely the further devaluation of the yuan due to domestic economic stagnation will affect the baht by further increasing the cost of Thailand exports to China.

4 minutes ago, Srikcir said:

Beginning of November the Fed doesn't seem it necessary to raise interest rates. I expect the status quo until January 2017. It is likely the further devaluation of the yuan due to domestic economic stagnation will affect the baht by further increasing the cost of Thailand exports to China.

 

Good point, quite possible but on the other hand the imports will be cheaper.