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  1. #1
    Thailand Expat misskit's Avatar
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    Economist in Thailand Predict Baht to Plummet Further in 2022

    Economists in Thailand predict that the bahtís value will fall to 38 to the US dollar this year, owing primarily to a stronger dollar as the Federal Reserve pursues a hawkish monetary policy.


    According to Kobsidthi Silpachai, head of capital markets research at Kasikornbank (KBank), the baht will fall to a range of 36.50-38 against the US dollar within the next month.


    He predicted that continued increases in the federal funds rate would cause the dollar to appreciate against other currencies, including the baht.

    According to Mr. Kobsidthi, the baht is expected to remain highly volatile due to external and internal factors, in line with money markets worldwide.


    At its meeting next week, the Bank of Thailandís Monetary Policy Committee (MPC) is expected to raise its benchmark policy rate by 25 basis points.


    The rate hike would strengthen the baht to 37 to the dollar next week, but the baht would fall as the dollar strengthened, he predicted.

    According to KBank, the baht will strengthen again in 2023, reaching 35 against the dollar by the first quarter of 2023, fueled primarily by tourism revenue.
    Furthermore, Mr. Kobsidthi expects the MPC to raise the policy rate by another 25 basis points at its November meeting, bringing it to 1.25% by the end of the year.


    Amonthep Chawla, from CIMB Thai Bank (CIMBT), said at a separate event that the bank expects the baht to reach 38 to the dollar due to a stronger dollar, in line with the Fedís hawkish policy rate hikes.


    CIMBT anticipates that the Bank of Thailand will raise its policy rate to 1.75% by the end of 2022, then continue to raise rates to 2.5% by the end of next year.


    ďWe expect the Bank of Thailand to raise its policy rate twice this year, by 50 basis points each, to keep the spread between Thailandís rate and the fed funds rate in check. The move is expected to slow the bahtís depreciation, ďHe stated.


    To better manage foreign exchange rate stability, Mr. Amonthep proposes that the Finance Ministry and central bank switch from their current inflation targeting framework to foreign exchange rate targeting.


    According to him, a stronger dollar will impact other currencies in the region, particularly the yuan and the baht.


    According to Mr. Amonthep, rising inflation is a key factor driving the central bank to raise its policy rate. CIMBT predicts inflation will average 6.2% this year and fall to 2.6% next year.


    According to CIMBT, despite the high inflation rate, the economy should continue to recover, largely due to a tourism sector recovery.


    CIMBT raised its forecast for the countryís GDP growth in 2022 to 3.2% from 3.1% previously.

    Economist In Thailand Predict Baht To Plummet Further In 2022

  2. #2
    Days Work Done! Norton's Avatar
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    Quote Originally Posted by misskit View Post
    Economists in Thailand predict that the baht’s value will fall to 38 to the US dollar this year
    Optimistic imo. I see nothing in the works that will strengthen the baht. I would say 40 to the $ more likely.

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