Author Topic: Baht strengtening/weakening  (Read 28539 times)

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Offline thaiga

Re: Baht strongest in 2 months
« Reply #30 on: June 12, 2013, 06:01:40 PM »
Not like you to get confused roger ;)

Great news hope it keeps going ;D   my last 10,000 check was only 39.90 :-[  all the rates are listed below


http://bankexchangerates.daytodaydata.net/default.aspx    :cheers
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Offline Johnnie F.

Re: Baht strongest in 2 months
« Reply #31 on: June 12, 2013, 06:30:52 PM »
For last Friday's ATM withdrawal I got already 40,354470 to the Euro. Keeps getting better steadily. The conversion is done by my bank in Germany. I pay a 1% fee to them and the 180 Baht for the bank here. So I got an effective rate of 39.67 at a withdrawal of 25,000 Baht.
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Offline Roger

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Re: Baht strongest in 2 months
« Reply #32 on: June 12, 2013, 08:44:52 PM »
Hello Thaiga and of course, I may be wrong or at my age - or possibly confused !
However IMHO the Baht is now weaker which is why we are getting more Baht for each £, or Euro, than we were a few weeks ago.
Thai Govt policy is to weaken the Baht to support activity and exports. When they weaken the currency, Thai exports become cheaper in terms of foreign currencies.
I can import a tonne of rice to UK now at say10% less than a week or two ago, because my pounds will buy more rice for which I pay in Baht.
I stand by the comment, that the thread is now about a weaker baht.
We're getting more Baht because it's weaker now.
My brain hurts !

Johnnie, your 39.67 stacks up with the interbank rate my lot show today - 41 thereabouts.
 

Offline coolkorat

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Re: Baht strongest in 2 months
« Reply #33 on: June 12, 2013, 08:59:41 PM »
The latest interbank figure is 48.4788, against a 12 month low of 43.5788 and a 12 month high of 50.23.72. I read this to mean we are not far from a return to a status quo figure of baht50/GBP1 shortly. I find it hard to imagine the baht will weaken further against the £, but remain hopeful. Will we ever see baht70/GBP1 again????
 

Offline Johnnie F.

Re: Baht strongest in 2 months
« Reply #34 on: June 12, 2013, 09:40:32 PM »
There are reports that investors are withdrawing their capital from the emerging markets, seeing better perspectives in the USA again, due to the revaluation of the US$. It's a worldwide movement. Stockmarkets in Asia and South America fell quite a lot today, in Thailand 5%, most since end 2011.
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Offline coolkorat

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Re: Baht strongest in 2 months
« Reply #35 on: June 12, 2013, 10:29:49 PM »
From a GBP perspective, it feels like a return to a status quo level at B50/£1 - the same is true of the Brazilian Real vs £. The Real is not a trading currency: the Baht value seems to be based on capital flows (currently outwards, as you say JF).

No mention of the Yen. It has been weakening against the GBP and USD, but since late May has seen a return to a stronger position against these and the Baht. Will this strengthening be reflected by other Asian currencies, and is the Baht about to strengthen? The BoT did say it would be a rollercoaster for the foreseeable future......

My (unprofessional) opinion is that the Baht will reach a comfort level and bounce around for the remainder of the year at roughly B50/£1.
 

Offline Roger

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Re: Baht strongest in 2 months
« Reply #36 on: June 13, 2013, 05:06:19 AM »
Coolkorat - if it sets around Baht 50 to £1. Lovely. Baht 'weakest' now for 2 months ?
 

Offline thaiga

Re: Baht strongest in 2 months
« Reply #37 on: June 13, 2013, 11:58:52 AM »
Baht 'weakest' now for 2 months ?
better change the heading jf - would be nice if it was - Baht 'weakest' now for 2 years ;D
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Offline thaiga

Re: Baht strongest in 2 months
« Reply #38 on: June 13, 2013, 12:33:22 PM »
Baht down 0.5% to 31.08 per dollar

Thailand's baht traded 0.4% off a nine-month low and government bonds dropped as overseas investors reduced holdings of the country's assets amid a worsening global economic outlook.

The World Bank cut its 2013 growth forecast for developing countries to 5.1% from a January estimate of 5.5% and lowered China to 7.7% from 8.4%, according to a report on Wednesday.

China is Thailand's biggest export market after purchasing 12% of total shipments in the first four months of the year. International investors sold US$1.1 billion more Thai equities than they bought this month and pulled a net $205 million from bonds, official data showed.

"The weakening currency discourages foreign investors from the nation's stocks and bonds," said Yuji Kameoka, chief foreign-exchange strategist at Daiwa Securities Co in Tokyo. "The impact from China's slowdown is quite large on Asia through its exports, while growth concerns are leading to risk-off sentiment."

The baht declined 0.5% to 31.08 per dollar as of 9.22am in Bangkok, according to data compiled by Bloomberg. It touched 31.19 on Wednesay, the weakest level since Sept 7. One-month implied volatility, a measure of expected moves in the exchange rate used to price options, climbed nine basis points to 7.36%, a level last seen in December 2011.

Finance Minister Kittiratt Na-Ranong said on Wednesday that fund outflows from Thailand may be a positive factor, helping to weaken the baht. The currency has dropped 8.1% after reaching its strongest level since 1997 in April.

Further weakness in the currency may accelerate foreign sales of Thai equities, Maybank Kim Eng Securities (Thailand) Plc, the country's biggest stock brokerage, said in a research note on Thursday. The SET Index has lost 6.3% in the last two days and closed yesterday at its lowest since January.

The yield on 3.625% government bonds due June 2023 rose one basis point, or 0.01 percentage point, to 4.02%, data compiled by Bloomberg show. That’s the highest level for a benchmark note of that maturity since August 2011.

bangkokpost
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Offline Johnnie F.

Central Bank intervenes to stabilize the baht
« Reply #39 on: June 14, 2013, 09:38:23 AM »
Central Bank intervenes to stabilize the baht

The Bank of Thailand (BoT) intervened in the foreign exchange market after the baht declined 0.5% to 31.08 to the US dollar on Thursday morning, as the Thai stock market plunged for the third consecutive day.

Central Bank governor Prasarn Trairatvorakul said the baht's recent depreciation was not worrying because other currencies in Southeast Asia had also weakened.

The level of fluctuation of the baht was low when compared to other regional currencies.

"In this case, the BoT has already sold some US dollars to prevent further fluctuation, but we won't move against the market trend," Mr Prasarn said.

Finance Minister Kittiratt Na-Ranong said the weakening baht would benefit Thai exporters, who have long complained the baht was over valued, but admitted it would probably hurt the import sector.

"I would like the central bank to help stabilise the baht by using our large international reserves as a buffer to ease the impact (on importers) and keep the currency stable and in line with our trading partners and competitors, and not just rely on the US dollar," Mr Kittiratt said.

The Thai currency traded 0.4% off a nine-month low Thursday and government bonds dropped as overseas investors reduced holdings of the country's assets amid a worsening global economic outlook, according to  Bloomberg News.

The World Bank on Wednesday cut its 2013 growth forecast for developing countries to 5.1% from a January estimate of 5.5% and lowered China to 7.7% from 8.4%, the report said.

China is Thailand's biggest export market after purchasing 12% of total shipments in the first four months of the year. The baht declined 0.5% to 31.08 per dollar as of 9.22am in Bangkok, according to data compiled by Bloomberg. It touched 31.19 on Wednesay, the weakest level since Sept 7. One-month implied volatility, a measure of expected moves in the exchange rate used to price options, climbed nine basis points to 7.36%, a level last seen in December 2011.

International investors sold US$1.1 billion more Thai equities than they bought this month and pulled a net $205 million from bonds, official data showed.

"The weakening currency discourages foreign investors from the nation's stocks and bonds," said Yuji Kameoka, chief foreign-exchange strategist at Daiwa Securities Co in Tokyo. "The impact from China's slowdown is quite large on Asia through its exports, while growth concerns are leading to risk-off sentiment."

Mr Prasarn said the Thai stock market plunged more than 70 points on Thursday morning. This was likely due to the sharp sell-off in the bourse as investors expect the US economy to improve.

"The capital outflow is not yet worrying because the amount is not much when compared to the reserves of 180 billion dollars," the BoT chief said. "We cannot tell when the outflow stops because it's an external factor."

The Thai stock market opened in the morning with the plunge by 50.90 points or 3.62% from the close on Wednesday to stand at 1,381.57 point. The index moved in the negative zone for the whole day with the lowest point was at 1,351.95, or dropped 81.52 points.

The SET index rebound in the afternoon to close at 1,403.27 points, down 30.20 points or 2.11 % in total trade of 85.39 billion baht.

The Thai bourse has experienced a big sell-off since Tuesday. The index has dropped by 125.28 points or 8.19% from Monday's close at 1,528.55 points.

Analysts and regulators agree that the plunge caused from external factors, especially the improvement in the US credit rating.

Info Quest reported that the European stock markets in London and France also dropped at their opening in the afternoon (Thai time) due to worry over the cut in global economic growth projection to 2.2% in 2013, slightly lower than earlier projection in January at 2.4%. Developing countries will lead the growth with 5.1%.

However, the World Bank concluded that the economic risks appeared to be diminishing and the growth is more stable than the post-2008 financial crisis which the US caused the global economy into recession.

Bangkok Post

Sounds to me like 1997, where they did the same to the effect of making some Thais with insider knowledge a lot richer, and the Baht later fell even much deeper then.
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sicho

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Re: Baht strongest in 2 months
« Reply #40 on: June 14, 2013, 10:20:45 AM »
If I have understood all the double talk lately, the government wants the Baht to devalue and the BoT wants to hold it up. Have I got that right?
 

Offline Johnnie F.

Re: Baht strongest in 2 months
« Reply #41 on: June 14, 2013, 10:33:25 AM »
They do one first, and then the other. People who have the insider knowledge about when they'll do what, have the chance to trade accordingly.
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Offline thaiga

Re: Baht strongest in 2 months
« Reply #42 on: June 14, 2013, 12:03:30 PM »
Bit more from the nation

America declares war on world currencies

BANGKOK: -- It can now be fully confirmed that we are in the middle of a currency war on a global scale. On April 19, the Thai baht was trading at Bt28.55 against the US dollar. At that point, Dr Prasarn Trairatvorakul, the Bank of Thailand governor, almost lost his job.

He'd failed to stem the baht's rise. And he had also defended the central bank's interest rate policy as appropriate for the potential growth of the Thai economy.

Prasarn is also reluctant to intervene in the foreign exchange market to weaken the baht. Doing so would create further losses on the central bank's balance sheet when the weak dollar is converted to baht term. Yet the rapid rise of the baht, which breached the Bt28 level, is seen as unacceptable by the government and powerful exporters. The Bank of Thailand has become a punching bag.

But over the past week the central bank has been buying up the baht to prevent its rapid decline.

A sudden shift in sentiment derives from the possibility that the US Federal Reserve might cut back its quantitative easing (QE). Ben Bernanke, the chairman of the US Federal Reserve, has hinted that the Fed might pull back some of its QE, now going on at the rate of US$85 billion a month, if there are further signs of the US recovery. Standard and Poor's, the rating agency, has also upgraded the US credit outlook from negative to positive. These signs are good enough to send the Japanese stock market and other emerging markets tumbling.

The Fed launched the currency war through its QE, which started after the collapse of Wall Street and the US stock market in 2008. By printing dollars on a massive scale and holding the interest rate to almost 0 per cent, the Fed has pursued a double-edged policy. First, the cheap dollar helps push up financial assets and prevents the banks from failing. Second, it creates bubbles in other markets and pushes up the value of other currencies and makes their exports less competitive. This is a classic currency war.

The US has given Japan a pat on the back. Japan, which has been in an economic slump for more than 20 years, has been persuaded to adopt QE. It had tried QE eight times in the past, to no avail. "Abenomics" calls for QE 9, which is designed to prop up inflation from 1 per cent to 2 per cent and double the balance sheet of the Bank of Japan to $2.7 trillion. This has helped push up the stock market by more than 70 per cent to the 15,942 level. The yen, which stood at 77 to the dollar in September last year, was also been dragged down to 103-104 recently to boost exports.

But a hint that the Fed might take away some of the punch bowls has spoiled it all. The baht has swung from Bt28.55 against the dollar in April to Bt31 on Wednesday and Bt30.95 yesterday. The yen appreciated from 87 against the dollar last year to peak at 104 before rising to 94 now. The Nikkei index has fallen almost like a stone from 15,942 to 12,582.

The events in Thailand and Japan show that we do not have control over our interest rate, foreign exchange or capital market. As a peripheral country, Thailand's financial markets are subject to the policy of the Fed, which stands high at the centre of global finance.

This brings us to the recent debate on the interest-rate policy between the Finance Ministry and the Bank of Thailand. Deputy Prime Minister and Finance Minister Kittiratt Na Ranong, in particular, had been applying pressure for the central bank to cut the interest rate by at least one full percentage point to stem capital inflows. He believes that the wide gap in the interest rate differential between the baht (2.75 per cent) and the dollar (0.25 per cent) was the main reason for the capital inflows. Foreign money, which largely went into the Thai bond market, pushed up the baht's value. It also went into the stock market to drive up the SET index to 1,650.

Representatives of the Finance Ministry, the National Economic and Social Development Board and the Federation of Thai Industries came out in chorus to urge a drastic cut in the central bank's rate to stimulate the economy and also to discourage capital inflows.

The central bank has budged by agreeing to cut the interest rate by 25 basis points to 2.50 percent. It has also introduced four capital control measures in case of further rapid rises in the baht.

But the sudden outflow of capital, which has sent the Thai stock marketing tumbling and the baht on a sliding path, shows that the interest rate has little - or virtually no influence - over capital inflow. When the financial centre - the Fed in this case - coughs, all of the world's financial markets recoil for fear of catching a cold.

We are in the middle of the currency war. But few have a clue as to what actually is happening. By playing the game of the Fed, we'll all lose our shirts soon.

the nation
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Offline thaiga

Thai baht predicted to fluctuate around 30.40-30.80 baht per US dollar this week
BANGKOK, 17 June 2013 (NNT)
Kasikorn Research Center has forecast that the baht will move in the range of around 30.40-30.80 baht per US dollar this week as the influx of foreign currencies remains unstable.

According to Kasikorn Research Center, the direction of Thai baht this week would also depend on results of the U.S. Central Bank’s meeting expected to be concluded on Wednesday.

The U.S. fiscal policy will have a direct impact on foreign capital flows, which also determine the value of the Thai currency.

KResearch said important US economic factors that should be monitored are the property business index, and consumer and economic indexes. Another external factor that should also be monitored is the G-8 meeting

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Offline thaiga

Re: Baht drops, investors await Fed signal
« Reply #44 on: June 19, 2013, 12:42:24 PM »
Thailand's baht fell to within 0.4% of a nine-month low and bonds dropped as investors waited for a signal from the US Federal Reserve on the future of its stimulus program that has spurred fund flows to emerging markets.

Fed Chairman Ben S Bernanke will speak to reporters at the end of the monetary authority's two-day meeting on Wednesday. Global investors have pulled US$2.6 billion from Thai bonds and equities since May 22, when Bernanke said $85 billion a month of debt purchases could be reduced if there is a sustained improvement in the US jobs market. The benchmark SET Index of shares lost 12% during the same period.

"Investors don't want to take positions on risky assets at this moment," said Pareena Phuangsiri, a Bangkok-based analyst at Kasikornbank Plc. "Domestically, sentiment is not so good either with the SET Index falling. Foreign selling of bonds and stocks also weigh on the baht."

The baht fell 0.5% to 31 per dollar as of 8.55am in Bangkok and touched 31.08 earlier, data compiled by Bloomberg show. It reached 31.19 on June 12, the weakest level since Sept 7, and has lost 1.4% since June 14. One-month implied volatility, a measure of expected moves in the exchange rate used to price options, rose six basis points, or 0.06 percentage point, to 7.9%.

The yield on the 3.625% government bonds due June 2023 climbed two basis points to 3.83%, according to data compiled by Bloomberg. Baht-denominated debt has declined 1.4% this month, less than a 3.3% drop for Indonesian notes and a 1.9% slide for the Philippines, indexes compiled by HSBC Holdings Plc show.

The government sees no need to implement measures to stem outflows, Somchai Sujjapongse, director-general of the Finance Ministry's Fiscal Policy Office, said on June 14, adding that money will eventually flow back.

bangkokpost

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Offline thaiga

Re: BoT to let Thai baht move freely
« Reply #45 on: June 20, 2013, 06:06:34 PM »
The rapid outflow of foreign capital has yet to end but the Bank of Thailand will allow the baht to move freely in line with the money market mechanism, BoT deputy governor for monetary stability Pongpen Ruengvirayudh said on Thursday.

Ms Pongpen was responding to the announcement the US Federal Reserve  would gradually slowdown its quantitative easing measure (QE) later this year and would end it in mid-2014, if the US economy improves.

She said the US Fed’s declaration made its policy clear to the international community, different from its previous uncertain stance on the QE measure.

As a result, it was probable that foreign capital investment earlier placed in the emerging markets, including Thailand, would continue to flow out, she said. This would depend on the economic indicators in the US.

The current capital outflow was not a cause of concern when compared to the recent capital influx and the level of Thailand’s foreign reserves, the deputy BoT chief said.

Ms Pongpen admitted capital outflow would further weaken the value of the Thai currency, but the central bank would allow the baht to move in line with the market mechanism, she said.

If the baht's value drops too rapidly, the central bank would oversee it to prevent a heavy fluctuation in the exchange rate, she said.

A similar situation prevailed with other currencies in the Asian region, and therefore investors dealing with foreign exchange should ensure they have risk management measures in place.

The baht closed at 30.61 baht to the US dollar on Wednesday, but it opened weaker to stand at 31.40 baht on Thursday morning.

bangkokpost

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Offline thaiga

Re: Baht rises to 1-week high
« Reply #46 on: July 11, 2013, 01:02:39 PM »
Thailand's baht rose to a one-week high and bonds gained after US Federal Reserve chairman Ben S Bernanke said the United States economy will continue to need monetary stimulus, easing concerns about outflows from emerging markets.

Bernanke said on Wednesday that "highly accommodative" policy will be needed for the "foreseeable future," driving up exchange rates and stocks across Asia. The Bank of Thailand kept its benchmark interest rate at 2.5% on Wednesday, while cutting estimates for 2013 economic growth and exports.

"With Bernanke's comments, sentiment toward emerging markets improved,” said Koji Fukaya, chief executive officer and foreign-exchange strategist at FPG Securities Co in Tokyo. "However, the basic trend has not turned around yet."

The baht climbed 0.6% to 31.10 per US dollar as of 8.56am in Bangkok and reached 31.04 earlier, the strongest level since July 3, according to data compiled by Bloomberg. One-month implied volatility, a measure of expected moves in the exchange rate used to price options, jumped 37 basis points, or 0.37 percentage point, to 7.65%.

Gross domestic product may increase less than 5% this year, the central bank said on Wednesday. New forecasts for the economy and export growth will be released on July 19. The Bank of Thailand's Monetary Policy Committee cut borrowing costs by a quarter of a percentage point in May after the baht reached a 16-year high of 28.56 per dollar in April.

'Hot Money'

"We think the main reason the MPC cut in May was the pressure from hot money inflows," Tim Condon, head of Asian research at ING Groep NV in Singapore, wrote in a research report on Thursday. "With the panic subsiding, we think the hot money will return and the government will counter with capital controls rather than interest rates." ING predicts the baht will appreciate to 29 per dollar by year-end.

The yield on the 3.625% government bonds due June 2023 dropped one basis point to 3.72%, data compiled by Bloomberg show. Thai local-currency sovereign notes have posted a loss of 0.7% over the past month as Bernanke signaled a possible end to monetary stimulus, an index compiled by HSBC Holdings Plc shows.

bangkokpost
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Offline coolkorat

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Re: Baht strongest in 2 months
« Reply #47 on: July 11, 2013, 04:21:11 PM »
Coolkorat - if it sets around Baht 50 to £1. Lovely. Baht 'weakest' now for 2 months ?


My prediction shows what I know about currencies! According to XE (http://www.xe.com/ - they have a great app also) baht/GBP is trading at Ƀ46.9035 to £1 - still some way off the GBP low of Ƀ43.5788.

Will there be more pressure for intervention by BoT? Is talk of an Egypt-style intervention a mechanism to create market uncertainty?
 

Offline thaiga

Re: Baht strongest in 2 months
« Reply #48 on: July 11, 2013, 05:04:18 PM »
My prediction shows what I know about currencies!


well my prediction was 60 bht - may have been more of a wish - we can live in hope.

dollar tumbles     uk.reuters.com

The dollar tumbled 1.2 percent against a basket of major currencies while the euro roared to a three-week high of $1.32085 at one stage, though it was back at $1.3038 by 0820 BST.
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Offline thaiga

Re: Thailand's baht advanced the most in a week
« Reply #49 on: July 18, 2013, 12:47:55 PM »
Baht rises as Bernanke eases concern

Thailand's baht advanced the most in a week after US Federal Reserve chairman Ben S Bernanke allayed concern the United States plans to curb stimulus that has fueled demand for emerging-market assets. Bonds were little changed.

Bernanke said in prepared testimony to the House Financial Services Committee on Thursday that the Fed's asset purchases "are by no means on a preset course" and could even be expanded should economic conditions warrant.

The baht touched a two-week high after exchange data showed foreign investors bought more Thai equities than they sold on each of the last six days, boosting their holdings by US$265 million in the longest run of net purchases in almost two months.

"Bernanke's comments were positive for emerging-market assets," said Tsutomu Soma, manager of Rakuten Securities Inc’s fixed-income business unit in Tokyo. "The market's focus has shifted to the situation in the US and the baht will continue to move on that factor. That baht saw a quite sharp, one-way decline and that situation will probably stabilise."

The currency appreciated 0.4%, the most since July 11, to 30.97 per dollar as of 8.31am in Bangkok, according to data compiled by Bloomberg. It touched 30.90, the strongest level since July 2. The baht has retreated 7.8% from an April level of 28.56 that was the strongest since 1997.

One-month implied volatility, a measure of expected moves in the exchange rate used to price options, declined 11 basis points, or 0.11 percentage point, to 6.98%.

Bond Inflows

Global funds purchased $192 million more debt than they sold this month through yesterday after selling a net $1.48 billion in May and June, Thai Bond Market Association data show.

The Thai government will continue to reduce the budget deficit each year even as it plans to invest 2 trillion baht ($65 billion) on infrastructure over the next seven years, Finance Minister Kittiratt Na-Ranong told reporters in Bangkok on July 16.

The yield on the 3.625% bonds due June 2023 was little changed at 3.69%, data compiled by Bloomberg show. Thai bonds handed investors a return of 0.3% this month through on Wednesday, a performance second only to the Philippines among Asia's 10 biggest economies excluding Japan, HSBC Holdings Plc indexes show.

bangkokpost
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Offline Johnnie F.

Baht drops on China slowdown
« Reply #50 on: July 26, 2013, 11:41:17 AM »
And down it goes again!


Baht drops on China slowdown

Thailand's baht dropped by the most in two weeks and bonds fell as a slowdown in China dimmed regional growth prospects and investors waited for United States jobs data for clues on whether the United States Federal Reserve will cut stimulus.

Manufacturing declined by more than estimated in China, Thailand's biggest export market, and home sales in the US rose to a five-year high, according to reports yesterday. The number of people in the world’s largest economy continuing to claim jobless benefits decreased by 89,000 in the week to July 13, according to the median estimate in a Bloomberg survey before data due Thursday, which may bolster the case for the Fed to reduce bond buying that has boosted fund flows to Asia.

"Weakening growth prospects in Asia on the weak China PMI yesterday" weighed on regional currencies, said Wee-Khoon Chong, a Hong Kong-based strategist at Societe Generale SA. "All eyes will be on claims data later today."

The baht declined 0.4%, the most since July 8, to 31.07 per US dollar as of 8.37am in Bangkok, according to data compiled by Bloomberg. It reached 31.10 earlier, the weakest level since July 19. One-month implied volatility, a measure of expected moves in the exchange rate used to price options, fell five basis points, or 0.05 percentage point, to 6.16%.

A Purchasing Managers Index from HSBC Holdings Plc and Markit Economics on Wednesday showed a preliminary reading for Chinese factory output of 47.7 in July, compared with a forecast of 48.2. China took 12% of Thai exports in the first five months of 2013, official data show.

Thai overseas sales rose 1.5% in June from a year earlier after a 5.3 percent drop the previous month, according to the median forecast of economists in a Bloomberg survey before customs data due Friday.

The yield on the 3.625% bonds due June 2023 increased one basis point to 3.86%, the highest level since June 26, according to data compiled by Bloomberg.

Bangkok Post

41.315 to the Euro already!
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Offline thaiga

Re: The baht is headed for a fourth monthly drop
« Reply #51 on: July 31, 2013, 12:38:37 PM »
Baht, bonds fall on growth risk

The baht is headed for a fourth monthly drop - its longest losing streak since 2008 - on concern an economic slowdown in China will hurt the country's exports.

A Bank of Thailand report on Wednesday will show the nation posted a current-account deficit for a third month in June, according to a Bloomberg survey of economists.

Ten-year government bonds dropped amid speculation the US Federal Reserve will give further clues today to the timing of reductions in monetary stimulus that has boosted demand for emerging-market assets.

"The deterioration in the current-account balance hurts sentiment and with China's slowdown, the export outlook won't be bright either," said Tsutomu Soma, a manager of Rakuten Securities Inc's fixed-income business unit department in Tokyo. "Still, the biggest attention is paid to the outlook for the Fed’s reduction in stimulus."

The baht depreciated 1% this month and 0.3% on Wednesday to 31.37 per United States dollar as of 9.09am in Bangkok, data compiled by Bloomberg show. That is its weakest level for three weeks. One-month implied volatility, a measure of expected moves in the exchange rate used to price options, slumped 191 basis points from the end of June and 16 basis points on Wednesday to 6.13%.

The country's current-account deficit totalled $785 million last month after a $1.05 billion of shortfall the previous month, according to the survey before data due to be published at 2.30pm. A customs report on July 26 showed exports decreased 3.4% in June after a 5.3% drop in May. Shipments to China, Thailand's biggest export market, plunged 17%.

Slowing Growth

The economy probably slowed in the second quarter from the preceding period on weak exports and cooling local demand, Ekniti Nitithanprapas, deputy director-general of the Finance Ministry's Fiscal Policy Office, said on July 29.

China’s Purchasing Managers' Index for manufacturing was 49.8 for July, lower than the mark of 50 which divides expansion and contraction, according to the median estimate in a Bloomberg survey before data due Aug 1.

The Fed, which has indicated asset purchases could be trimmed should risks to the US economy abate, will probably keep its key rate at 0.25% in an announcement after the Open Market Committee meeting on Wednesday, according to a Bloomberg survey.

The yield on the 3.625% sovereign bonds due June 2023 climbed 20 basis points, or 0.2 percentage point, to 3.96% this month, according to data compiled by Bloomberg. The rate, which increased two basis points Wednesday, is the highest since June 24.

bangkokpost
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Offline Johnnie F.

Re: Baht strongest in 2 months
« Reply #52 on: August 08, 2013, 12:19:10 PM »
Thai Baht Jumps as China Data Ease Slowdown Concerns; Bonds Gain

Thailand’s baht rose the most in four weeks after data showed exports and imports rebounded in China, the Southeast Asian nation’s largest overseas market. Government bonds advanced for a fourth day.

The currency sank to a one-month low yesterday as parliament began debating an amnesty bill for political prisoners and those facing charges related to government protests after former Prime Minister Thaksin Shinawatra was toppled in a 2006 coup. China’s overseas sales grew 5.1 percent in July, after a 3.1 percent drop the previous month, and imports climbed 11 percent, the government reported today.

“With lingering concern about China’s slowdown, people in the market reacted quickly to the strong data today,” said Koji Fukaya, chief executive officer and foreign-exchange strategist at FPG Securities Co. in Tokyo. “Domestically, there’s political concern in Thailand and investors may want to stay on the sidelines for a while.”

The baht advanced 0.4 percent, the most since July 11, to 31.32 per dollar as of 11:07 a.m. in Bangkok, according to data compiled by Bloomberg. It touched 31.49 yesterday, the weakest level since July 8. One-month implied volatility, a measure of expected moves in the exchange rate used to price options, fell eight basis points, or 0.08 percentage point, to 6.28 percent.

China accounted for 11 percent of Thailand’s exports in the first half of 2013, official data show. Bank of Thailand Governor Prasarn Trairatvorakul said on July 29 that total shipments during the period were lower than expected and there should be an improvement in the July-December period.

The yield on the 3.625 percent sovereign bonds due June 2023 declined three basis points to a one-week low of 3.94 percent, according to data compiled by Bloomberg.

Bloomberg

But the Euro is still at 41.764 to the Baht now. Hope it stays that way or even gets stronger.
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Offline thaiga

Re: BoT intervened to stabilise baht in Aug
« Reply #53 on: August 17, 2013, 12:51:00 AM »
The Bank of Thailand reported that foreign reserves as of Aug 9 totalled US$172.2 billion, an increase of $900 million from the previous week, with the central bank buying dollars from the spot market to keep the baht from fluctuating too sharply.

The net forward position, reflecting the central bank's status on foreign currency purchases in the futures market, totalled $23.7 billion, up $200 million from the previous week, putting net foreign reserves at $195.9 billion, it said.

Reserves increased slightly because the BoT had to intervene in the money market to curb the baht's fluctuation by purchasing US dollars on the spot market, the central bank said.

Cash flow from the private sector and financial institution deposits at the central bank totalled 1.34 trillion baht, slightly down from 1.37 trillion baht reported in the previous week. Current cash flow and liquidity is sufficient for accommodating spending demand in the system, the bank said.

bangkokpost
Anyone who goes to a psychiatrist should have his head examined.
 

Offline thaiga

Re: Thai baht remains weak this week
« Reply #54 on: August 19, 2013, 03:13:53 PM »
KRC says Thai baht remains weak this week

BANGKOK, 19 August 2013 (NNT)-Kasikorn Research Center (KRC) has forecast that the baht will fluctuate in the range of 31.10 – 31.50 baht per US dollar this week.

According to the KRC, domestic factors that could affect the currency this week include the GDP figure in the second quarter of this year, which is expected to be released within this week, and the monetary policy expected to be concluded by the Monetary Policy Committee this Wednesday.

Other factors to be considered include the U.S. unemployment rate, property sale index in that country, the outcomes of the Federal Reserve System’s meeting at the end of last month, as well as the PMI Indexes from various nations. However, the KRC said the Thai baht has so far remained weak given the higher global price of gold bar and the rigorous sales of US currency.

NNT

Buying Rates @ bangkokbank now UK pound = 48.22  euro = 41.18

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Offline thaiga

Re: Weak baht not a problem
« Reply #55 on: August 20, 2013, 03:32:50 PM »
Prasarn: Weak baht not a problem

The weakening baht is not a cause for concern because the country’s economic fundamentals are strong, Bank of Thailand governor Prasarn Trairatvorakul said on Tuesday.

Earlier today, the baht weakened to stand at 31.67 baht to the US dollar, the lowest level in one year, since July 2012.

Mr Prasarn admitted that he did not really know what had caused the value of the baht to weaken sharply.

It could be a result of reports about lower than expected economic growth in the second quarter of the year by the National Economic and Social Development Board (NESDB) on Monday, he said.

The central bank chief insisted that Thailand is not at risk of facing an economic crisis similar to that in Indonesia, because macroeconomic policy in the kingdom is reliable and the country does not have a problem with current account deficits, as seen in Indonesia.

Analysts said the baht value was squeezed by second quarter economic growth figures, which were much lower than expected.

The NESDB on Monday reported that the economy in the second quarter grew at a less-than-expected 2.8% year-on-year.

The state think-tank lowered its growth projection for 2013 to between 3.8% and 4.3% from the previous prediction of between 4.2% and 5.2%, due to a slower than expected global economic recovery, an end to mobilsation from government stimulus measures, a delay in the government's investment plans and continuing political conflict.

bangkokpost

Buying Rates @ bangkokbank now UK pound = 48.81   Euro = 41.65
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Offline Johnnie F.

Re: Weak baht not a problem
« Reply #56 on: August 20, 2013, 04:01:43 PM »
Mr Prasarn admitted that he did not really know what had caused the value of the baht to weaken sharply.


Bloomberg's got an answer for him:


Capital Flows Back to U.S. as Markets Slump Across Asia

Asia’s role as the world’s growth engine is waning as economies across the region weaken and investors pull out billions of dollars.

The Indian rupee fell to a record low today, Thailand is in recession and Indonesia’s widest current-account deficit pushed the rupiah to the lowest level since 2009. Chinese banks’ bad loans are rising and economists forecast Malaysia will post its second straight quarter of sub-5 percent growth this week.

The clouds forming in Asia as liquidity tightens and China’s slowdown curbs demand for commodities and goods are fueling a selloff of emerging-market stocks, reversing a flow of money into the region in favor of nascent recoveries in the U.S. and Europe. Emerging markets from Brazil to Indonesia have raised borrowing costs in 2013 to try to aid their currencies as the prospect of reduced U.S. monetary stimulus curbs demand for assets in developing nations.

“The eye of the storm is directly above emerging markets now, two years after it hovered over Europe and four years after it hit the U.S.,” said Stephen Jen, co-founder of hedge fund SLJ Macro Partners LLP in London and former head of foreign-exchange strategy at Morgan Stanley. “This could be serious for Asia.”

Of the $155.6 billion investors poured into developed-market equity exchange-traded products in the first seven months this year, North American funds received $102.4 billion or 65.8 percent, according to BlackRock Investment Institute. Japan attracted a record $28 billion, while Europe-focused funds got $4.3 billion. In contrast, $7.6 billion flowed out of emerging-market funds.

Swinging Back

“The pendulum is swinging back in favor of the advanced countries,” said Shane Oliver, Sydney-based head of investment strategy at AMP Capital Investors Ltd., which oversees about $130 billion. “It’s one of these things that happens once a decade or so when you see a turn in relative performance. We’ve entered a tougher, more difficult period” for Asia.

The IMF in July cut its forecast for growth this year in developing Asia by 0.3 percentage point to 6.9 percent.

In the past three months the MSCI Asia Pacific Index has fallen 7.7 percent, compared with a 1.2 percent decline in the Standard & Poor’s 500 Index and a 1.6 percent drop in the Stoxx Europe 600 Index. Signs of a stronger U.S. economy may prompt the Federal Reserve to begin paring its $85 billion in monthly bond purchases as soon as next month.

Indonesia’s benchmark equity index has slumped more than 10 percent in the past two days, while India’s has fallen about 3 percent and Thailand is down more than 6 percent.

Indian policy makers led by Prime Minister Manmohan Singh are battling to stem the rupee’s plunge, attract capital flows to bridge a record current account deficit and revive growth. The currency has weakened about 28 percent versus the dollar in the past two years, reviving memories of the early 1990s crisis, when the government received an International Monetary Fund loan as foreign reserves waned.

Indian Problems

“It seems now the pain is going to be in the emerging markets,” said Nitin Mathur, an analyst in Mumbai at Espirito Santo Investment Bank who expects sectors with higher valuations such as consumer goods to suffer the biggest declines. “The problems in India are not temporary blips. The problems are much more serious which will take a lot of effort to get resolved.”

In Thailand, the economy entered recession last quarter for the first time since the global financial crisis. Toyota Motor Corp. said last month industrywide car sales in Thailand will fall 9.5 percent this year. The government cut its 2013 growth forecast yesterday as exports cooled and local demand weakened, with higher household debt restricting scope for monetary easing.

Thai Credit

Thailand’s private-sector credit as a share of gross domestic product has “increased significantly” in recent years raising concern about financial stability, Krystal Tan, an economist at Capital Economics Ltd. in Singapore, said in a Bloomberg Brief commentary.

Taiwan last week cut its 2013 growth and exports forecasts and said the global outlook for the second half is worse than in May. The island’s export orders probably fell for a sixth month in July, a Bloomberg survey showed before data due today.

“We are seeing a turning point,” said Freya Beamish, Hong Kong-based economist with Lombard Street Research, who says China’s competitiveness has been hurt by labor costs that are 30 percent too high. “China’s seeing flat to falling growth on our estimates so the region’s clouds are already here.”

Sentiment is also being subdued by the prospect of a decline in U.S. stimulus, money that often finds its way to export-based countries in payment for goods.

Investors will be looking for clues on how quickly the U.S. Federal Reserve will trim its $85 billion in monthly asset purchases when the Federal Open Market Committee’s July meeting minutes are released on Aug. 21.

Flow Reversing

The $3.9 trillion of cash that flowed into emerging markets over the past four years has started to reverse since Chairman Ben S. Bernanke talked about a tapering in quantitative easing this year. The slowdown in Fed bond buying will probably begin next month, according to 65 percent of economists surveyed by Bloomberg from Aug. 9-13.

The JPMorgan Emerging Markets Currency Index has declined 2.4 percent since Bernanke’s June 19 tapering comment. The Bloomberg Dollar Index, which monitors the greenback against 10 major currencies, is almost unchanged over the same period.

“The emerging Asia story is crumbling and dollar is once again the king,” said Indranil Pan, chief economist at Kotak Mahindra Bank Ltd. in Mumbai.

India’s moves to tighten cash supply, restrict currency derivatives and curb gold imports since July failed to arrest the rupee’s slump to a record low of 64.12 per dollar today. UBS AG says a drop in the currency to 70 is possible.

The deficit widened to an unprecedented 4.8 percent of GDP in the year ended March 31. The government plans to narrow the gap to 3.7 percent, or $70 billion, this year, Finance Minister Palaniappan Chidambaram said Aug. 12.

Policy Gap

India’s slump is worse than elsewhere in Asia because the country has failed to carry out long-overdue structural changes to the economy, said Pan at Kotak Mahindra Bank.

“In India, we have great policies on paper but the gap between the what’s on paper and the implementation is unduly large,” R.C. Bhargava, chairman of Maruti Suzuki India Ltd., the nation’s biggest carmaker by volume, said in an interview. “If we just implement what’s already there, we can get back on track in the next two to three years.”

Richard Jerram, chief economist at Bank of Singapore Ltd., says the market declines reflect overly ambitious expectations rather than fundamental weakness in the economies.

“There’s a good structural story based on the underlying domestic demand,” said Jerram, who has analyzed Asian economies for two decades. “What you see at the moment is reaction from expectations being unrealistically positive maybe 12 months ago, to now becoming more realistic.”

Japan Rising

One bright spot is Japan, which has seen its economy bounce back on Prime Minister Shinzo Abe’s fiscal and monetary stimulus. The Topix stocks index has risen 32 percent this year.

Abe has yet to show that he can sustain the recovery by restructuring company and labor laws and taming the nation’s debt, which topped 1 quadrillion yen ($10 trillion) in June.

“Asia still has potential in the next three years or more, but in the shorter term, momentum for business is slowing down,” said Shuichi Hirukawa, senior fund manager at Mizuho Asset Management Co. in Tokyo. “Investors may become more cautious.”

China’s economy last quarter extended the longest streak of expansion below 8 percent in at least two decades, curbing earnings at companies such as Hong Kong-based Cathay Pacific Airways Ltd. Still, there are signs of improvement. Industrial output rose more than economists estimated in July, after larger-than-forecast rebounds in exports and imports and improvement in gauges of manufacturing and service industries.

China Change

China is making efforts to bolster confidence. Overall liquidity in China is ample as banks channel more funds to agriculture and small businesses in the world’s second-largest economy, People’s Bank of China Governor Zhou Xiaochuan said on state broadcaster China Central Television yesterday.

“Some Asian countries, especially India, have their own significant domestic challenges,” said Jim O’Neill, the former Goldman Sachs Group Inc. economist who coined the term BRIC in 2001 to describe Brazil, Russia, India and China. “But China is slowing primarily to improve its growth model and at 7-7.5 percent annual growth is still delivering $1 trillion nominal GDP. And Japan, still Asia’s No. 2 economy, is looking better than it has done for a very long time.”

The slowdown in economies such as Indonesia and Thailand is part of a “very, very global” weakness, World Bank Chief Economist Kaushik Basu told reporters in New Delhi yesterday.

‘So Slow’

The U.S. recovery “was so slow that even the slightest pick up is looking like a pick up,” Basu said. “I don’t think the Asian situation is any worse. In fact, if anything, Asia is probably better off than the rest of the world.”

That may not help markets in Asia as money continues to flow back to Europe and the U.S., said Oliver at AMP Capital. Norway may say today its economy expanded in the second quarter after a contraction in the previous three months, a survey showed. The Federal Reserve Bank of Chicago will release a report on U.S. economic activity for July.

“Asia will still be a stronger part of the world than the U.S. or Europe but compared to people’s expectations Asia is likely to come in a little bit lower than expected,” he said.

The IMF in July forecast global growth of 3.1 percent and projected advanced economies would expand 1.2 percent this year.

Stocks Opportunity

“We see this drop as an opportunity to buy selectively those stocks that have been overpriced” such as banks and consumer shares, Kiekie Boenawan, Jakarta-based head of investment at PT Schroder Investment Management Indonesia, wrote in an e-mail yesterday.

Investors will be scanning data from Chinese factories to Malaysian growth this week for further signs of weakness.

An Aug. 22 flash reading for China on a manufacturing purchasing managers’ index by HSBC Holdings Plc and Markit Economics is expected to come in at 48.1 for August, from 47.7 in July, according to the median economist estimate compiled by Bloomberg. A reading below 50 indicates contraction.

Malaysia’s central bank on Aug. 21 may post data showing 4.7 percent economic growth in the second quarter from a year earlier, after rising 4.1 percent in the January-March period, its slowest rate since September 2009, according to the median estimate of economists in a Bloomberg survey.

Brazil’s Real

Slumping currencies and inflation risks in emerging markets are adding to pressure on central banks to raise interest rates. Brazil increased its benchmark rate this year more than any major economy to prevent higher prices from slowing consumption and investments. The real weakened beyond 2.4 per dollar for the first time in four years yesterday.

Higher rates in turn would hit consumers in countries where cheap mortgages and easy credit have fueled housing booms.

“Southeast Asian consumers have taken on much higher debt in the last few years,” Royal Bank of Scotland Group Plc analyst Sanjay Mathur wrote in a July 18 report. He said the largest increase was in Malaysia, where household debt increased by 20 percent of GDP between 2008 and 2012.

There’s a feeling that “the rest of the world’s getting a bit better and Asean’s had its sort of burst of credit-enhanced growth,” said Edward Teather, an economist at UBS AG who covers Southeast Asian markets from Singapore. “It’s raining already.”

Businessweek.com

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Offline Johnnie F.

Re: Baht strongest in 2 months
« Reply #57 on: August 22, 2013, 10:20:20 AM »
Baht Falls to Three-Year Low on Fed Minutes, Growth Concern

Thailand’s baht fell to the weakest level since August 2010 after Federal Reserve minutes showed officials support a cut in stimulus this year if the U.S. economy improves.

The baht slipped beyond 32 per dollar for the first time since July 2012 as official data showed global funds sold $582 million more Thai bonds than they bought this month through yesterday and pulled a net 30.6 billion baht ($954 million) from equities. A government report this week showed Southeast Asia’s second-largest economy entered a recession for the first time since 2009.

Bloomberg.com reports. The Euro is up at 42.819 right now. Hope it keeps rising. Inflation in Thailand and the overvalued Baht had made life for many expats difficult. Most people weren't able to support their family to the extent anymore, those had gotten used to. While those also suffered from rising prices, the allowances from their foreign son-in-laws got cut due to them not having so much money left over from their own direct needs.
Fun is the one thing that money can't buy
 

sicho

  • Guest
Re: Baht strongest in 2 months
« Reply #58 on: August 22, 2013, 10:38:04 AM »
Sterling is quoted at £1 to THB50.11 today.
 

Offline Johnnie F.

Baht fall cheers exporters
« Reply #59 on: August 23, 2013, 12:09:04 PM »
Baht fall cheers exporters

Exporters and tourism businesses have welcomed the weakening of the baht, hoping it will help the country reach its export-growth target. However, importers who have not locked in advance contracts could be hurt.

Yesterday the baht weakened to 32 per US dollar for the first time since August 2010 as official data showed global funds sold US$582 million (Bt18.6 billion) more Thai bonds than they bought this month through yesterday and pulled out a net Bt30.6 billion ($954 million) from equities. A government report this week showed that Southeast Asia's second-largest economy entered a recession for the first time since 2009.

Tak Bunnag, executive vice president of Bank of Ayudhya's treasury group, said the weakening of the baht was partly due to fundamentals of the Thai economy, to which investors gave 30-per-cent weight when deciding where to put their money.

Estimates of growth in Thailand's gross domestic product were lowered on Monday to 3.8-4.2 per cent after growth in the second quarter was slower than in the first.

He said the economies of most Asian countries were slowing along with China's, with a consequent depreciation of their currencies.

Year to date, the baht has depreciated by 4.8 per cent against the dollar. Indonesia's rupiah has weakened by 12.6 per cent and India's rupee has seen the largest decline at 19.6 per cent.

Tak said investors had reallocated their funds ahead of the tapering of the United States' quantitative-easing programme. If the US Federal Reserve ends QE, the baht might not drop much, and might even begin strengthening again.

Markets expect the Fed to reduce its bond purchases next month.

Kampol Adireksombat, senior economist at Tisco Securities, said the baht was depreciating too much as foreign investors were worried about emerging-market economies. Some current accounts are in deficits.

The baht weakened 0.75 per cent to 32.07 per dollar yesterday morning.

"The baht is overshooting because of foreigners' concern over emerging countries' current-account deficits. Indonesia's is in a deficit of 3-4 per cent of its GDP. Thailand's current account was in a slight deficit in the first half of this year," Kampol said.

According to the National Economic and Social Development Board, Thailand had a current-account deficit of 5.1 per cent of GDP in the second quarter. In the first half, the current account was in a deficit of 1.9 per cent of GDP.

Kampol expects the Thai economy, particularly exports, to recover in the latter half of this year, and that could reduce the current-account deficit to no more than 1 per cent of GDP, or even put it into a slight surplus.

He also expects the baht to appreciate to about 31.5 per dollar late in the year.

Meanwhile, Deputy Commerce Minister Niwatthumrong Boonsongpaisan said the government will not seek Bank of Thailand's in the exchange rate, although the baht's rapid depreciation has affected some traders.

He said the ministry and involved agencies will revise the export target for this year next month.

Drive export growth

Pornsilp Patcharintanakul, vice chairman of the Thai Chamber of Commerce, said the weaker baht should have a positive impact on the trading sector overall. However, it would affect some sectors that rely on imports, particularly fuel, chemical fertiliser, wheat flour and machinery.

"The concern is about a rapid depreciation or appreciation in a short period that could affect traders' confidence about the baht's fluctuation," he said.

Pornsilp said the baht's movement should also change in accordance with those of trading competitors in the region. So far, the baht, the Malaysian ringgit and the Philippine peso are weakening, while other currencies such as the Chinese yuan and Vietnamese dong have not depreciated. This could reduce traders' and investors' confidence in the Thai economy.

Despite the baht's depreciation, he said exports would still face difficulty achieving this year's growth target of 5-7 per cent. The sluggish global economy will likely keep export growth down to only 3 per cent.

In addition, because of the sudden weakening of the baht, some importers who have not fixed exchange rates in advance could be seriously hurt.

For instance, some machinery importers will need to pay more if they ordered goods while the baht was around 30 against the greenback.

Veerachai Chaochankit, chairman of the Agricultural Machinery Club under the Federation of Thai Industries, said about 10 per cent of agricultural machinery was imported from overseas and would be affected by the baht's depreciation. However, this impact should be minimal as most traders had advance contracts that were normally flexible.

Veerachai said traders favoured stable currencies rather than those that fluctuated rapidly in a short time.

Tourist boom

Pornthip Hirunkate, vice president of the Tourism Council of Thailand, said the tourism industry still looked optimistic. The weaker baht would give foreign tourists more spending power and back the Kingdom's reputation as a value-for-money destination. This would help spur the sector's performance in the approaching high season.

However, outbound tour agencies will feel somewhat of a pinch because Thai tourists will have to pay more, she said.

Overall, she remains confident that the industry can adjust to the situation. The bitter experience from the 1997 financial crisis and other, more recent serious troubles have made operators even stronger and more flexible.

She said financial experts should be allowed to handle the exchange-rate issue. The baht is weakening on the same trend as elsewhere in Asia. The government should not interfere with its value because that would distort the market landscape and create problems in the future.

The Nation
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