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## tomcat

*A Southeast Asian Currency Is Set to Top 2018’s Emerging-Market List*
By Yumi Teso (Bloomberg)
December 13, 2018, 4:00 AM GMT+7

Potential central bank interest-rake hike seen as supportive Foreigners set to be net buyers of Thai bonds for third year

Having a strong buffer in times of stress does pay off. Just look at the baht.

The Thai currency has declined 0.6 percent to 32.785 against the dollar this year as of 2:20 p.m. in Bangkok Wednesday, the best performance among 22 major developing-economy currencies tracked by Bloomberg. A current-account surplus and ample foreign-exchange reserves helped offset headwinds from the Federal Reserve’s tightening path and escalating trade tension between the U.S. and China.

*Key Insights*


Thailand has posted current-account surpluses every month since the end of September 2014. As a percentage of gross domestic product, the third-quarter balance of 7.7 percent is among the highest in Asia and compares with Taiwan’s 13 percent.Customs exports also posted gains every months but two in 2017 and 2018, supporting demand for the Thai currency. Despite some signs of a slowdown, the tourism sector remains a major driver. Exports of goods and services account for about two-thirds of Southeast Asia’s second-largest economy.Foreign reserves are at about $203 billion, more than twice the amount the International Monetary Fund deems as adequate.Speculation that the Bank of Thailand next week will deliver its first interest-rate increase since 2011 has also bolstered the baht; the central bank’s monetary policy committee discussed "conditions and appropriate timing to begin normalizing monetary policy in the future," according to the minutes of the Nov. 14 rate decision.A combination of economic recovery and benign inflation was also supportive, with fund inflows to the bond market at $9.2 billion this year through Dec. 11. The finance ministry predicts economic growth of 4.5 percent for 2018, following 3.9 percent expansion in 2017. Inflation was 0.94 percent in November, with the commerce ministry saying a rate of about 1 percent is right for the economy.“There are not many countries like Thailand where the local economy is getting better but inflation is benign,” Jitipol Puksamatanan, Bangkok-based chief strategist at Krung Thai Bank Pcl, said. “This characteristic could be considered as the best of breed among EM currencies.” He expects the baht to strengthen to 30.7 per dollar by end-2019.

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## headhunter

the average debt per.houseold is at record levels,most banks have record NPL.corruption is rife and the gov.is giving away money like confetti.
please someone enlighten a DUMB TAFF as to what is what.

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## can123

This dumb Taff is banking on a devaluation of the Thai Baht by 15 - 20 %.

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## tomcat

...apparently, neither of you has read the article above...

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## can123

> ...apparently, neither of you has read the article above...


I am sure that neither of us is as clever as you.

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## tomcat

...apparently so...

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## kmart

> the average debt per.houseold is at record levels,most banks have record NPL.corruption is rife and the gov.is giving away money like confetti.
> please someone enlighten a DUMB TAFF as to what is what.


The corruption here at least you know about or tacitly account for.. Or it's kept to a less than debilitating level. Thailand for all it's faults hasn't sold off it's industries or 'family silver' so far. Also maintains a trade surplus. The vast majority of it's population own land here also. Compare that to the West.  -The whole charade maintained on never-never credit, escalating wars and arms races; by a 1% that own all the media, and everyone one else fighting over the crumbs from their table..

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## can123

Strangely, I cannot recall either Headhunter or my good self commenting directly on the article. We simply expressed personal views. Are you capable of appreciating the distinction ?

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## tomcat

> Are you capable of appreciating the distinction ?


...apparently not...

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## Maanaam

> Foreigners set to be net buyers of Thai bonds for third year


Do those foreign buyers take into account a potentially nasty outcome after the election?



> The finance ministry predicts economic growth of 4.5 percent for 2018


Did the author take this with a grain of salt, considering there is an upcoming farce of an election?



> the average debt per.houseold is at record levels


Indeed.






> apparently, neither of you has read the article above


Apparently they did, but the author of the article is ignorant of facts on the ground.

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## tomcat

...the baht should be stable as long as the Central Bank is not subject to the whims of the government of the day...the examples of Venezuela and Zimbabwe should deter politicians from interference...

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## Maanaam

> ...the baht should be stable as long as the Central Bank is not subject to the whims of the government of the day...the examples of Venezuela and Zimbabwe should deter politicians from interference...


Not wrong. Someone should tell Prayut.

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## SKkin

> ...the baht should be stable as long as the Central Bank is not subject to the whims of the government of the day...the examples of Venezuela and Zimbabwe should deter politicians from interference...


Was that the problem in 1997? The banksters didnt have free rein...

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## headhunter

there is quite a lot i dont understand regarding the THAI GROWTH FORCASTS.
b.o.t.predict 2019,savings and lending rates will likely be increased in the second half of next yr.saving rates up that will put a smile on my wife's face.
yet they then predict that LOAN GROWTH will gather pace.most banks are up to thier necks with N.P.L.already.and they are likely to hit a fresh record high by mid 2019.
mai-cow-jai.

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## Pragmatic

> The vast majority of it's population own land here also


 'Own land' ? I think that wrong. Most Thais have Sor Por Kor land which is 'Crown' land and it can be taken off of them as and when. You only own land when it becomes 'Chanote' and those are in the minority as far as I'm aware. Yes Sor Por Kor land is bought and sold but in reality it shouldn't be. Buyer beware. As they say.

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## tomcat

> Was that the problem in 1997? The banksters didnt have free rein...


...to a degree, yes: official policy at that time was to defend a fixed rate of 25 to the dollar...the Central Bank ran through most of its reserves when the Thai economy turned south and foreigners (and many locals-including a soon-to-be prime minister who, aware of an imminent devaluation and subsequent baht float, bought millions  of dollars from the Central Bank and later sold them back to the bank at 55 to the dollar...rumored to have started on his first billion that way) fled with their hard currency...eventually, an IMF loan established stability and, over the years, the baht strengthened to where it is today...

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## Norton

The central bank has generally done a good job since 1997. Doubt there will be big swings in the baht but increasing private debt, decrease in direct foreign investment, and decrease in tourism are not positive signs for economy.

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## jabir

> This dumb Taff is banking on a devaluation of the Thai Baht by 15 - 20 %.


Sounds more like it might go the other way.

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## Klondyke

> Most Thais have Sor Por Kor land which is 'Crown' land


No, I don't think it's so. Everybody living in his own house inside a village (soi) has got a chanote. Also in the Bkk outskirts... 
Different it can be with vast land lots outside communities.

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## Klondyke

> This dumb Taff is banking on a devaluation of the Thai Baht by 15 - 20 %.


A dream for exporters...

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## headhunter

> the average debt per.houseold is at record levels,most banks have record NPL.corruption is rife and the gov.is giving away money like confetti.
> please someone enlighten a DUMB TAFF as to what is what.


seems me not as dumb as I thought.
I have always thought who to believe when this is up,this too is up,everything is up according to them who must be as dumb as me.when Thailand is up to its neck in DEBT.
just been reading the latest schemes from them that knows all.
and a quote from a top economic who say's these so called schemes [latest] is hurting fiscal discipline in the long run.
one example was the excise tax refund for first time car buyers,that has put more people in debt and has weakened the economy.
and the latest ones DONT add up.old people on low income maximum 8,000bht.a month can claim the vat.back[great] but wait for it,they MUST SPEND 10,000bht to get it.
so is taff as dumb as he thought .answers on a woodbine pck.

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## tomcat

...keep in mind there is a difference between government debt (usually expressed as government treasury bonds) and private debt (between a bank and a borrower)...non-performing loans will affect the latter, not the former (unless a large systemic bank like Bangkok bank has so many NPLs that's its continuing ability to do business is in jeopardy)...

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## Maanaam

> .keep in mind there is a difference between government debt (usually expressed as government treasury bonds) and private debt (between a bank and a borrower)


Thanks for clarifying that. Who'da thunk?

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## docmartin

Wouldnt a country that exports rice, rubber and cars and imports tourists want a cheap currency ?
But what would I know. Im just a naif who assumes that the world economy is a zero-sum game where debts = credits. 
Which it aint. Apparently were all in debt to the future but Im not sure who got the future to agree to that.

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## HuangLao

> ...apparently, neither of you has read the article above...



.....and make up the usual shit as they go along.

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## tomcat

> Who'da thunk?


...headhunter sounds like he wouldnathunk...

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