Thai Baht hits highs, BoT to take measures

[buksida]

I don't think Thailand cares much about the US these days, its all about China - they have the money now. The American economy is heading for recession by the looks of things.

[buksida]

Central bank plans steps to curb strong baht
Thailand is not in recession but growing below potential and the central bank is ready to take action if needed, while there are also plans for further measures to curb the baht's strength, central bank and government officials said on Thursday.

The policy committee is "very concerned" about the strength of the baht and will further relax rules on capital outflows within 1-2 months, Bank of Thailand governor Veerathai Santiprabhob told reporters and analysts.

Thai investors would be allowed to invest more abroad and exporters to keep foreign currencies overseas for longer, the governor had told Reuters in an interview last week. Exporters are now allowed to keep funds abroad for a year.

The central bank will ensure gold trading flows will not affect foreign exchange rates, given large gold investments in Thailand, Mr Veerathai said. The governor was speaking at an analyst meeting held at the central bank.

https://www.bangkokpost.com/business/17 ... trong-baht

[stretch]

Concerned but happy to do nothing.

[pitsch]

Every time the central bank plans to curb the strong baht, the next days the baht gets even stronger.

[buksida]

Central bank takes extraordinary steps to cool off baht
The Bank of Thailand has taken unprecedented steps to liberalise capital outflow, allowing residents of the country to take money overseas to invest directly and the domestic trading in gold in foreign currencies.

Central bank governor Veerathai Santiprabhob announced the measures this week as a bid to slow the baht’s worryingly rapid appreciation.The new measures will come into effect on Friday (November , he said.Exporters will be allowed to park their earnings abroad – up to US$200,000 per invoice, increased from the current $50,000.

The figure will rise to $1 million within three months, Veerathai told reporters. “This is so exporters can manage their exchange risk better, since they’ll be able to bring their money back when exchange rate is more favourable for them, or they could use their foreign currency for their businesses abroad,” he said.

Retail investors are allowed to invest up to $200,000 per annum directly in foreign financial assets. Currently they must go through brokerage firms or mutual funds, and even then, only high-net-worth individuals with Bt50 million or more in savings.

https://www.nationthailand.com/business/30378120


Private sector wants panel set up to handle surging currency
Business operators are preparing to hold talks with the Finance Ministry and the Bank of Thailand about the strong baht, as the surging currency is estimated to have cost exporters 200-300 billion baht.

The Joint Standing Committee on Commerce, Industry and Banking (JSCCIB) held its monthly meeting yesterday to monitor the economy. Kalin Sarasin, chairman of the Thai Chamber of Commerce, said the baht has gained 7-8% versus the US dollar, the highest appreciation in Asia this year.

https://www.bangkokpost.com/business/17 ... g-currency


Bank of Thailand cuts rate to 1.25 per cent
The Bank of Thailand’s monetary policy committee voted on Wednesday (November 6) to cut its key policy rate by 25 basis points to 1.25 per cent.

It is the second rate cut this year after a 1.5-per-cent trim in August, which was the first cut in four years.Today’s committee meeting saw five members vote for the cut and two to maintain the existing rate.

The International Monetary Fund had earlier said Thailand had the policy in place to cut its interest rate and the fiscal power to spend more on infrastructure even amid the global economic slowdown being worsened by the US-China trade war.

https://www.nationthailand.com/news/30378116

[buksida]

BoT: Many options to fight baht strength
The Bank of Thailand says it has many tools left to manage capital inflows and curb the local currency's strength, which is hurting growth prospects in the Southeast Asian economy.

The scope and speed of the baht's appreciation is out of line with economic fundamentals such as the current account surplus, said Don Nakornthab, a senior director in the central bank's economic and policy department.

What monetary policymakers have done so far are "baby steps", he said Monday in his office in Bangkok.

"On capital inflow measures, I think they have a lot of options," Mr Don said, pointing to measures that some countries have used, such as holding periods, to curb hot money flows.

The central bank in July imposed measures to counter short-term inflows and last month relaxed rules to spur outflows. The baht has climbed more than 8% against the dollar in the past 12 months, hurting exports and tourism and putting the economy on course for the slowest annual growth in five years.

https://www.bangkokpost.com/business/18 ... t-strength


The central bank may want to curb the baht but the dictators certainly don't as it would hamper their ability to buy cheaper Chinese real estate and subs.

[buksida]

Baht to remain strong: Kasikorn Research Centre
The value of the baht this week (December 23-27) is expected to remain strong, according to KBank’s research arm.

Kasikorn Research Centre expects the baht to move within a range of 30.10-30.50 per US dollar. A key domestic factor to be monitored closely is November’s export data.

External factors will include preparation for the first phase of the US-China trade deal. US economic data, to be released this week, includes new home sales in November and durable goods orders data. Meanwhile, the trading volume will likely be thin as most global markets enter the period of year-end holidays.

https://www.nationthailand.com/business/30379749

They keep citing this US/China trade excuse which is utter bull - the junta and Thailand's elite profit from a stronger baht which is why they won't devalue.

[HHTel]

And meanwhile, every time our Boris says anything, the pound falls!!

[buksida]

Baht keeps strength despite coronavirus outbreak, economic decline
The Thai economy in 2020 would expand at a much lower rate than previous forecast and way below its full potential, mainly due to the combined impact from the coronavirus outbreak, delay to enactment of the Annual Budget Expenditure Act and drought on a large number of businesses and employment, according to the minutes released today by the Monetary Policy Committee of the Bank of Thailand .

On February 5 , the committee voted unanimously to cut the policy rate by 0.25 percentage point from 1.25 to 1.00 per cent, in a bid to shore up the economy.

Regarding exchange rates, the committee said although the Thai baht depreciated somewhat in recent days , it remained potentially inconsistent with economic fundamentals. During inter-meeting period, the currency depreciated against the US dollar.

The baht also depreciated against regional currencies as reflected by a decline in nominal effective exchange rate (NEER) despite its high level compared with that in the past.

The recent depreciation was mainly a result of investors’ concerns over the softening outlook of the Thai economy, from both domestic and external prespectives , as well as the Bank of Thailand’s relaxation of foreign exchange regulations to facilitate capital outflows.

Investors started to view that the baht could depreciate after a substantial appreciation last year, the report said.


https://www.nationthailand.com/business/30382434

[Bluesky]

Baht keeps strength despite coronavirus outbreak, economic decline
The Thai economy in 2020 would expand at a much lower rate than previous forecast and way below its full potential, mainly due to the combined impact from the coronavirus outbreak, delay to enactment of the Annual Budget Expenditure Act and drought on a large number of businesses and employment, according to the minutes released today by the Monetary Policy Committee of the Bank of Thailand .

On February 5 , the committee voted unanimously to cut the policy rate by 0.25 percentage point from 1.25 to 1.00 per cent, in a bid to shore up the economy.

Regarding exchange rates, the committee said although the Thai baht depreciated somewhat in recent days , it remained potentially inconsistent with economic fundamentals. During inter-meeting period, the currency depreciated against the US dollar.

The baht also depreciated against regional currencies as reflected by a decline in nominal effective exchange rate (NEER) despite its high level compared with that in the past.

The recent depreciation was mainly a result of investors’ concerns over the softening outlook of the Thai economy, from both domestic and external prespectives , as well as the Bank of Thailand’s relaxation of foreign exchange regulations to facilitate capital outflows.

Investors started to view that the baht could depreciate after a substantial appreciation last year, the report said.


https://www.nationthailand.com/business/30382434

I am wondering whether George Sorros/ Quantum fund will have another crack at the Baht if conditions are right, perhaps with his previous Thai acquaintances?


Some background
https://www.businessinsider.com/how-geo ... and-2016-9

[huahin4ever]

And now the upturn may be over.....

The baht’s current shine as the ‘safe’ current in Asia has lost its lustre. After riding high as Asia’s best performing currency last year, the baht has wiped out all of its 8% gains this year during the Covid-19 crisis, and yesterday’s announcement of the resignations of Deputy PM Somkid Jatusripitak and “the four big boys” (4 of Prayut Chan-o-cha’s economic ministers) saw it drop even further, reflecting investors’ concerns about the government’s continued economic policies.

Full story here:
https://thethaiger.com/hot-news/economy ... op-further

YNWA

[buksida]

BoT prepares more baht measures
The Bank of Thailand stands ready to implement additional measures to manage the strengthening baht under a targeted policy, on both a short-term and long-term basis.

The central bank's Monetary Policy Committee (MPC) has expressed concerns over the rapid appreciation of the baht as this affects the fragile economic recovery.

"The Bank of Thailand has several instruments to manage the baht. We will consider additional targeted measures and implement them continuously to manage the exchange rate for both the short and long term," said MPC secretary Titanun Mallikamas.

The central bank has continued to manage the movement of the exchange rate reflecting rising international reserves. Thailand's foreign reserves were registered at US$252 billion (7.7 trillion baht) as of Nov 6, up from $249 billion logged on Oct 30.

In 2019, the central bank lowered the cap on the outstanding balance of a non-resident account from 300 million baht per person to 200 million, an attempt to tamper inflows of short-term inflows speculating on the baht.

The US presidential election and progress on a Covid-19 vaccine have induced a risk-on sentiment, subsequently attracting foreign capital inflows to move into emerging markets across the globe, he said.

These developments have caused the baht to appreciate, although the currency has registered a year-to-date depreciation against the US dollar, said Mr Titanun.

The baht has strengthened by 4.3% against the greenback since the last MPC meeting on Sept 23.

The local currency appreciation ranks third after the Indonesian rupiah (5.3%) and Korean won (5.2%).

https://www.bangkokpost.com/business/20 ... t-measures

These 'measures' they keep talking about do not seem to be very effective ... you could go as far as to say the bankers, billionaires, and politicians don't want a weaker currency. Economic woes that are crippling the rest of the country certainly don't affect them.

[Big Boy]

It is exactly the same as I said on the getting into Thailand' thread yesterday. They are putting out the right message whilst doing exactly what they want.

Somebody suggested yesterday that Thais don't have the intelligence to do that. I think people are totally underestimating the intelligence of the Thais. Maybe the people who don't have the intelligence are the ones underestimating the intelligence of the Thai BS merchants. They are laughing at the rest of the world.

[buksida]

Then I guess it is up to the remaining 69.5 million of them to get off their arses and join the students.

[Big Boy]

That wouldn't work either. It won't be the 69.5 million who would take the reins. There will always be another BS merchant with his head up his own arse waiting to take over. This is Asia, whoever takes over will soon find a way to make their fortune, and forget the 69.5 million.