Baht What up with Dat?????

2 dollars to the pound? looks like holidays in Florida instead of Pattaya this Christmas.

Freedom Fried wrote:Factor in the upward trend in Thai oil import prices with no slowing in industrial/consumer demand and hey presto, downward pressure on the Thai baht

I definitely am not an expert,so you may be right,but I was thinking that this would not be much of a ''factor'' because the increase in prices is the same globally.Unless,Thai consumer demand maintains a higher ratio of demand causing greater inflationary pressure

Jimbo and those interested here's a quote from today's Bangkok Post:

QUOTE:
Baht 'will continue to strengthen'

Bank of Thailand Governor M.R. Pridiyathorn Devakula says the baht is going to grow stronger. The central bank intends to ignore demands from the government and exporters to stem the rally.

The baht "has to strengthen," said the governor in an interview with the Bloomberg business news agency on Monday. Bloomberg released a story on the interview early today Thailand time.

Bloomberg quoted M.R. Pridiyathorn as saying: "If you go against the trend, you are dead. I'm telling the exporters this so they can prepare themselves."

The baht strengthed in the New York market overnight, and was trading at 37.63 per US dollar early today. Finance Minister Thanong Bidaya said on July 17 that a range of 37.75-to-38.25 was "the right level" for the currency.

The baht has "performed well this year," Bloomberg quoted Usara Wilaipich, an economist at Standard Chartered Bank, said in Bangkok. The currency "can keep going up and benefit from more inflows" of capital.
END OF QUOTE.

I had been waiting to transfer some funds here from the Uk and eventually took the plunge at the beginning of last week. So it worked out well, I think I got about 70.6. It was done on tuesday/wednesday when the rate was good, though before the last jump up on friday.

The rate now seems to be backing off again - the baht v pound that is.

And here's a clip from a news article about the Fed leaving US rates as they are:

US Fed holds interest rates

Washington (dpa) - The US Federal Reserve on Tuesday left its benchmark interest rate at 5.25 per cent, ending a record string of 17 straight increases dating back to 2004.

But the Fed also said that "some inflation risks still remain" and left the door open for further rate increases later in the year, sending US stocks lower after the announcement.

In a nine-to-one vote, the Federal Reserve Board said it based its current decision on a slowing US economy.

End of Quote

Surely Jimbo, the link betwen the dollar and baht is important to us (pound holders). On the one hand I can't see the dollar appreciating against the pound. In which case if the baht maintains any link between it and the dollar, then it should not strengthen against the pound either. Though clearly the link between the dollar and baht has become very much more elastic lately, if not non-existent!

Well us guys who work on the dollar are sure interested just like you pound holders.

Again not being sharp at this stuff, it almost sounds to me like the Thai's in this instance are willing to give up some export monies, to make the fund they have more powerful. That seems like short range planning to benefit a few at cost of many. But we all know that never happens here.

I guess we are going to find out just how much power exporters really have. I don't think they are going to be happy selling over priced goods.

For America this may turn out to be a blessing and maybe they will go back to making thier own goods, since it could very well be cheaper then importing. Pesoanlly I'm good to go even if drops down to 23 baht per dollar. Just can't do my normal savings. But that rate would not really effect my lifestyle. I think it would be a very long time before we see that happen.

Alll this is doing is making me keep my money out of country, because from what I can see things will change again.

Starting next month I will reduce the amount I bring into country monthly by 30% and wait for favorable times.

This is a bit unpleasant for me but for exporters it has got to hit hard.

OUCH

08/04/2006 37.92050
08/05/2006 37.87920
08/06/2006 37.940
08/07/2006 37.940
08/08/2006 37.7840
08/09/2006 37.70140
08/10/2006 37.62620


Average (7 days): 37.82733
High: 37.98000
Low: 37.44000

Thai Baht Rises to Six-Year High on Inflows to Stock Market
Aug. 11 (Bloomberg) -- The Thai baht climbed to the highest in more than six years and headed for its best week since April as overseas investors bought stocks.

The currency also rose as central bank Governor Pridiyathorn Devakula said in an interview published Aug. 9 the baht will extend its rally. Investment from abroad has pushed up the baht 9 percent this year, on course for the biggest advance since 1998, when the currency recovered from the Asian Financial crisis.

``There's more to go for the baht,'' said Magnus Prim, a senior currency strategist in Singapore at Skandinaviska Enskilda Banken. ``We're seeing the central bank say they won't take any aggressive measures to stop the development of a rising baht. There's still pretty strong inflows.''

The baht advanced 0.2 percent to 37.36 per dollar as of 9:17 a.m. in Bangkok, the highest since Feb. 11, 2000. It may climb to 37 per dollar this year, said Prim.

Overseas investors bought shares the previous four days, according to stock exchange data. There was no data available for today.

The baht also strengthened as a chart some traders use to predict prices showed the currency may rise.

Gains yesterday beyond a so-called resistance level, an area where people expect more selling, signal a further rise, according to Raymond Chang, vice president of sales at Shun Loong Holdings Ltd., a unit of Hong Kong brokerage Sun Hung Kai & Co. The baht yesterday advanced through 37.44, where the gain stalled on May 1 and May 2.

``Breaking this resistance area makes the chart for the baht really bullish,'' Chang said. ``The trend remains up.'' The currency may climb to 37.32, the high reached on Feb. 10, 2000, and then to 36.79, the strongest since Jan. 3, 2000, Chang said.

Whoops, sorry folks. That is a Bloomberg report.

Well on the up side at least the money I have here is worth more.

ray23 wrote:Well on the up side at least the money I have here is worth more.

Ray,I think that is only true if we compare to the money we have in the American banks,not in actual spending power as many goods and sevices are rising in cost as the Baht strengthens! Like you,we have no worrys about income,just the savings in the states are weakening and the lack of interest on my personal Thai accounts as inflation creeps in.My monthly incomes die with me!So,I have some concern for my famlies future if the baht and inflation eat away at present and past savings!

Ya I agree I've noticed that as well. To be honest I like having a nest egg in dollars it may go down but it won't stay there forever. America has been through a lot before. In the mid 1970's it was difficult to find work for example mid 1980's jobs were every where. There are boom times in America and recessions, we were overdue for the recession, it is here. Things will change.


It's just a down cycle just like the many we have had before. We just like the boom times.

As far as I can see we are much better off then the local Thai's who have to deal with this. The purchase power is down and thier salaries at least in this area don't seem to be increasing and keeping pace. Like you said not as much in savings this year and probably not the year I will buy the new 750 CC bike.

Amazingly times like this can be great opportunity time as well. A friend just bought 5.5 Ria of land 10 KMS out of Udon on a paved road with electricity and phone lines to the property line, red stamp clear title for 460K. Why the guy was broke and losing his pickup to the finance company.

There will be deals around for those who have cash.