[george]

Baht hits new 10-year high against dollar

BANGKOK: -- The baht currency appreciated to 33.13 to the US dollar on Monday, its strongest showing in 10 years against a continuously weakening greenback.

Currency dealers at Bank of Ayudhya predicted that the baht would further strengthen to 33 to the dollar soon. The US dollar is weaker because of concerns about a US economic slowdown.

The latest US trade figures showed that in November the country experienced a trade deficit of US$6.3 billion, the highest in 14 months, since imports, particularly of fuel, had increased.

At the same time, the country's exports edged up by 0.4 per cent, hitting a record one-month high boosted by the weaker US dollar.

Meanwhile, the Stock Exchange of Thailand's composite index continued to drop in the morning trading session in the same direction with other regional markets.

It opened lower and fell below a support level of 790 points, but recouped its loss and closed at 791.30, down 5.17 or 0.65 per cent, with a thin trading volume of 4.95 billion baht.

--TNA 2008-01-14

Related link:
Baht offshore rates
http://baht.thaivisa.com

[TAWP]

All the while export companies are hemoring money and everyone is too afraid to raise their prices in dollar too much or at all...guess another bank loan will solve it.

[A_Traveller]

Pardon?

The internal rate is as above, however the international quoted mid-rate is 29.8232 THB to 1 USD

Regards

This post has been edited by A_Traveller: 2008-01-14 16:10

[TAWP]

Just a personal reflection.

Let's just say the immediate family is heavily into exports and are effectively losing money per sale as it stands now. And with a lot of million baht in debt to banks...well, I'll leave it up to your imagination. Last time there was problems like this they borrowed more. And borrowing to sustain bleeding and being able to eat is very dangerous.

[chrislarsson]

A_Traveller, on 2008-01-14 16:10:01, said:

The internal rate is as above, however the international quoted mid-rate is 29.8232 THB to 1 USD

I hope nobody is foolish enough to do the exchange at the offshore rate anyway.

Today's rate to the Euro is 48.76. That is more or less the the same rate as it has been the last 5 years.
This is really only a problem if you have your assets in USD or is exporting in USD.

[bubba]

Remember when the baht was weak and prices for imported goods kept rising and rising?

Has anyone seen retail baht prices for the same goods decrease at all due to the now strong baht?

[marshbags]

TAWP, on 2008-01-14 16:15:48, said:

Just a personal reflection.

Let's just say the immediate family is heavily into exports and are effectively losing money per sale as it stands now. And with a lot of million baht in debt to banks...well, I'll leave it up to your imagination. Last time there was problems like this they borrowed more. And borrowing to sustain bleeding and being able to eat is very dangerous.

Echos of 1997 will be the eventual outcome for many of them.

HTF can they keep providing and giving loans out to all and sundry when it is as obvious as the nose on your face, they cannot and do not have a hope in hel_l of paying it back

IMHO based simply on my observations in my neck of the woods from the top down.

Top equals mega borrowing of course and in many cases they haven,t got a satang to scratch their armholes with.

I,m not an expert, but, it seems like simple maths to me, based on my budgeting philosophy throughout my working life and now.

marshbags

[wrecker]

Maybe you went to a Thai school, where math is a problem. The Euro, did around 35 to to the bath only a few years ago. The problem is simple, not that baht is strengthening, the Dollar is weakening because of an insane monetary policy of the US. The Euro is actually strengthening against all other major currencies including the Pound Sterling and the Yen.
The header should have been, THE DOLLAR IS WEAKENING AGAINST ALL MAJOR AND MOST SOUTH EAST ASIAN CURRENCIES.
Do not worry you can still make money, ask the Germans. If the currency rate would be a real problem , the German economy was wiped out decades ago with their strong D-Mark. Certain countries are used to strong currencies and will turn a problem in an opportunity. And otherwise we still have the Thai army....

[maxcrc]

That s true. But there are MANY thai exporters who still export in US$.
Actually, in some sectors most of them still quote in $ and for them it is a very big problem.
Well, my self I am in the same situation because I have more customers in the Americas than in Europe.
So, if you keep the prices your profit will go almost to nothing.
If you rise the price accordingly, your customers will need new pricelists every month or so and they will not be happy (some of them understand other don t want to understand).
If you change your pricelist in euros your american customers will ask for a conversion and than say"wow ! thats much more than last time." But you can say "Now ,it is the same price (in euros or bahts) as you can see... Exchange rate has changed".

It is not easy, but it is not just a problem of the Baht ,it is a problem of a weak dollar worldwide.

Check the exchange rate $ with philippines peso (and this is not any asian tiger !!) from 57 to about 41 now.
Brazilan real ? From almost 4 to 1.8 !! Chilean peso ? From over 750 to 495 !
South African rand ? even worse.

UK pound is already declining , Canadian dollar last fall highest peak will not probably been overtaken, but euro has still some weeks or few months to possibly rise and than will start to go down.
But asian currencies may still carry the weight of a further appreciation driven by Chinese RNB appreciation.
RNB (yuan) appreciation is under way and will follow I think until the Olympic Games, inflation in China is raising dangerously and yuan needs to strenghten to avoid a dangerous double digit inflation.

I hope after Songkran thai baht will start to slow too.

US $ will soon recover against the euro (slowly anyway)but still not now...if benchmark will be cut there is still room for a depreciation.
US $ policy for me is wrong because it is true that US $ exports are more competetive but think about the cost of IMPORTS (including OIL) ...if you import more than what you export, the cheaper the currencies and huger and huger the deficit...this is mathematics...
and moreover higher oil prices fuel inflation...and slow economy + risk of inflation is a real BAD thing because if you cut the rate inflation will go even higher but if you don t do that a recession is just outside the doors.

May I say this US administration really suck ?? With Clinton USA has at the same time: strong dollar, incredible budget SURPLUS, moderate cuurent account deficit (under control) , big economic growth,
low unemployment ....
now they have been using the opposite receipt for years with disastrous results and they still follow that way.

This post has been edited by maxcrc: 2008-01-14 16:49

[A_Traveller]

chrislarsson, on 2008-01-14 16:26:51, said:

A_Traveller, on 2008-01-14 16:10:01, said:

The internal rate is as above, however the international quoted mid-rate is 29.8232 THB to 1 USD

I hope nobody is foolish enough to do the exchange at the offshore rate anyway.

Hm.. I know people who have found that payments to them,via, for example websites and PayPal arrive at the international rate, so they are not foolish but caught by this.

Regards
/edit typo//

This post has been edited by A_Traveller: 2008-01-14 16:47

[cclub75]

wrecker, on 2008-01-14 16:39:57, said:

The header should have been, THE DOLLAR IS WEAKENING AGAINST ALL MAJOR AND MOST SOUTH EAST ASIAN CURRENCIES.

Hear ! Hear !

Nobody gives a rat shit about THB... Dollar is falling. Period. We have a global trend.

I propose a little pray for all our friends here, who denied with force the global trend. The mighty USD was supposed to play the "comeback kid".... Amen.

Toilets. This is the place where it belongs.

I bet that denial will continue. It's human. Confronted to a losse... that is growing with time... the denial increases too.

[Greenside]

bubba, on 2008-01-14 16:29:26, said:

Remember when the baht was weak and prices for imported goods kept rising and rising?

Has anyone seen retail baht prices for the same goods decrease at all due to the now strong baht?

That's pretty much the natural order of things but don't forget that the cost of many raw materials is skyrocketing due in no small part to the demand from China and of course there's a transport element in almost all products which is rising fast along with every oil derived item. In fact just by holding prices level many companies will now be seeing their margins shrink so I wouldn't hold my breath waiting to see any price reductions anytime soon.

I started a very un-scientific thread about price rises on the Chiang Mai forum and there seems to have been a lot of (small in baht terms but big percentage) rises in food, restaurants etc in the past few months. Twenty percent here, 15% there.....

[Naam]

A_Traveller, on 2008-01-14 16:10:01, said:

however the international quoted mid-rate is..

the rate nobody of us cares a sh*t about

[maxcrc]

cclub75, on 2008-01-14 16:49:11, said:

wrecker, on 2008-01-14 16:39:57, said:

The header should have been, THE DOLLAR IS WEAKENING AGAINST ALL MAJOR AND MOST SOUTH EAST ASIAN CURRENCIES.

Hear ! Hear !

Nobody gives a rat shit about THB... Dollar is falling. Period. We have a global trend.

I propose a little pray for all our friends here, who denied with force the global trend. The mighty USD was supposed to play the "comeback kid".... Amen.

Toilets. This is the place where it belongs.

I bet that denial will continue. It's human. Confronted to a losse... that is growing with time... the denial increases too.

It is normal people dont agree 100% . But instead "fighting" in the forum... just let s do something:
in 12 months we will back here and check the euro-dollar exchange rate.

Falling buck is a Republican policy just like Papi Bush and just like Reagan ...(rememebr 1992 1.45 $ for 1 synthetic euro ?).
For me they screwed everything and the current situation show this policy doesn t work.

Free to disagree. Anyway, talk to you back at the end of 2008...I bet for a $ higher than now compared to the euro and you bet for the opposite.
Friendly race....different thinkings...Dont forget :-)

This post has been edited by maxcrc: 2008-01-14 16:59

[A_Traveller]

Naam, on 2008-01-14 16:56:50, said:

A_Traveller, on 2008-01-14 16:10:01, said:

however the international quoted mid-rate is..

the rate nobody of us cares a sh*t about

Walter, see 10 post above, and by the by, why not use the ?

Regards
PS No not my business concern, but many here claim to be running web based businesses.

This post has been edited by A_Traveller: 2008-01-14 17:00

[Brewsta]

A_Traveller, on 2008-01-14 17:10:01, said:

Pardon?

The internal rate is as above, however the international quoted mid-rate is 29.8232 THB to 1 USD

Regards

Works both ways on the exchange.....

just got dosh from Aus: Au$2900 converted by BankTransfer (ITT) into: 84,699 Baht in my Bangkok Bank a/c....

i.e. 29.20 baht to the Au$....... have not seen 29.8 to 30.50 for months....sigh..... good for you.

But according to the 'offshore rate' at Xe.com , those Au$ are only worth : 77,552.53 THB @ 26.7423

which would lose me nearly 30,000 Baht....... on a 300,000 baht monthly retainer....... nearly 10% in the ether....each month?

go figure?

regz to all.

[A_Traveller]

The present answer is that if conversions are done in country, then the internal rate will be used. However, as many have noted, banks, both here and foreign, do not always use the most beneficial rate, hence why it is wise to be aware of the rate gap and ensure clarity in your instructions to a transferring bank, if you are so able to do.

Regards
/edit typo//

This post has been edited by A_Traveller: 2008-01-14 17:06

[Neeranam]

Excellent, long may it continue to increase!


I want to travel there soon with my family.

This post has been edited by Neeranam: 2008-01-14 17:08

[john b good]

The Baht is NOT appreciating.

The greenback is on the slide.

And the SET is not doing particularly well either. It is over 10 years since the "asian crisis" (initiated here in the realm) and the SET was hovering around 1400. Today the SET is 791.15 so still more than 600 off what it was in mid 97.

So what is the Thai economy recovery "from" and what is the "benchmark" that is being used.

[Naam]

A_Traveller, on 2008-01-14 16:59:27, said:

Naam, on 2008-01-14 16:56:50, said:

A_Traveller, on 2008-01-14 16:10:01, said:

however the international quoted mid-rate is..

the rate nobody of us cares a sh*t about

Walter, see 10 post above, and by the by, why not use the ?

touché! mea culpa!

[beginner]

john b good, on 2008-01-14 17:08:34, said:

The Baht is NOT appreciating.

Why does it feel like it is then?

Forget theory....what advice do you give to expats here living off incomes flows based on capital in other countries?

Would you bring over a couple of years living expenses right now if it was

a. in euroland
b. in UK
c. in Oz
d. in NZ
e. in USA

An explanation of why you advocate a particular course of action would be appreciated.

[rbrister333]

maxcrc, on 2008-01-14 16:45:14, said:

That s true. But there are MANY thai exporters who still export in US$.
Actually, in some sectors most of them still quote in $ and for them it is a very big problem.
Well, my self I am in the same situation because I have more customers in the Americas than in Europe.
So, if you keep the prices your profit will go almost to nothing.
If you rise the price accordingly, your customers will need new pricelists every month or so and they will not be happy (some of them understand other don t want to understand).
If you change your pricelist in euros your american customers will ask for a conversion and than say"wow ! thats much more than last time." But you can say "Now ,it is the same price (in euros or bahts) as you can see... Exchange rate has changed".

It is not easy, but it is not just a problem of the Baht ,it is a problem of a weak dollar worldwide.

Check the exchange rate $ with philippines peso (and this is not any asian tiger !!) from 57 to about 41 now.
Brazilan real ? From almost 4 to 1.8 !! Chilean peso ? From over 750 to 495 !
South African rand ? even worse.

UK pound is already declining , Canadian dollar last fall highest peak will not probably been overtaken, but euro has still some weeks or few months to possibly rise and than will start to go down.
But asian currencies may still carry the weight of a further appreciation driven by Chinese RNB appreciation.
RNB (yuan) appreciation is under way and will follow I think until the Olympic Games, inflation in China is raising dangerously and yuan needs to strenghten to avoid a dangerous double digit inflation.

I hope after Songkran thai baht will start to slow too.

US $ will soon recover against the euro (slowly anyway)but still not now...if benchmark will be cut there is still room for a depreciation.
US $ policy for me is wrong because it is true that US $ exports are more competetive but think about the cost of IMPORTS (including OIL) ...if you import more than what you export, the cheaper the currencies and huger and huger the deficit...this is mathematics...
and moreover higher oil prices fuel inflation...and slow economy + risk of inflation is a real BAD thing because if you cut the rate inflation will go even higher but if you don t do that a recession is just outside the doors.

May I say this US administration really suck ?? With Clinton USA has at the same time: strong dollar, incredible budget SURPLUS, moderate cuurent account deficit (under control) , big economic growth,
low unemployment ....
now they have been using the opposite receipt for years with disastrous results and they still follow that way.

RMB. RMN is Renminbi not RNB. If you are going to act like you know what you are talking about, please know the basics, you can fool us with the rest.

[Leethom]

Think about all the negative events that have happened in Thailand over the last two years, many of them extremely detrimental to the image of Thailand in the world. Every event has produced a stronger baht. Thailand is also listed as having the second most corrupt economy in Asia. Look at tourism this year - way down - and one of the major sources of income for the country.

[ace]

I don't see why the falling $ is seen as a problem (apart from for expats). For years the US has been running a massive current account deficit, the domestic markets, especially cars, struggling against the rest of the World. What better way to redress this than a weaker currency?

[Naam]

rbrister333, on 2008-01-14 17:23:38, said:

RMB. RMN is Renminbi not RNB.

the international code/abbreviation for the chinese currency is CNY.