webfact Posted August 9, 2019 Share Posted August 9, 2019 BOT urges hedging to counter unpredictable baht By The Nation The Bank of Thailand (BOT), under pressure to make a further cut to its policy rate, has warned businesses that the stubbornly strong baht could move in either direction despite this week’s action to reduce the benchmark rate. The central bank’s assistant governor, Chantavarn Sucharitakul, on Friday issued the statement that the currency could move up or down as a caution to those worried about a further strengthening of the currency. Chantavarn, who made the statement after a meeting with business leaders, said the reality that the baht could rise or fall meant importers and exporters should hedge against exchange rate risks. The meeting between BOT officials and representatives from the Thai Chamber of Commerce and the Federation of Thai Industries took place amid concerns expressed by companies over the impact of the strong baht. The baht remains persistently strong after the Bank of Thailand cut its policy rate by 0.25 percentage point to 1.5 per cent on Wednesday, prompting business groups to call for more cuts. At 1.5 per cent, Thailand’s policy rate is among the lowest in the region and below that of the US policy rate, said the central bank. The central bank said the baht has risen 5 per cent against the US dollar since early this year, driven by the country’s large current account surplus. The baht stood at Bt30.73 per cent to the dollar at noon on Friday, according to Reuters. The current account surplus for the first seven months of this year was US$17.4, despite a contraction in exports. A larger contraction in imports contributed to the surplus. Low levels of investment in the country are also a major factor behind the surplus, and the central bank needs the involvement of other parties to jointly solve the problem, Chantavarn said. Public and private investment should be accelerated in order to import more raw materials and machinery so as to upgrade the country’s competitiveness. The central bank said that it had managed the baht carefully to avoid being accused of currency manipulation in order to gain trade advantages, said the statement, apparently in reference to the hostile US government policies against trade partners. The US last week denounced China as a currency manipulator after the yuan breached the 7 to the dollar level, with the declaration heightening trade war tensions. The central bank also called for importers and exporters to quote more local currencies in their term of trade. The share of Thailand’s exports to the US is about 10 per cent of the total, but Thai businesses quote their prices in dollars for up to 80 per cent of the trade value. Source: https://www.nationthailand.com/business/30374532 -- © Copyright The Nation Thailand 2019-08-09 Follow Thaivisa on LINE for breaking Thailand news and visa info Link to comment Share on other sites More sharing options...
Mavideol Posted August 9, 2019 Share Posted August 9, 2019 Tourism industry not happy at all, nearby China yuan depreciation is not helping the sector, westerners stay away from Thailand and the expats living here stay at home avoiding unnecessary expenses, purchasing power dropping on a daily basis, future not looking rosy at all Link to comment Share on other sites More sharing options...
ivor bigun Posted August 9, 2019 Share Posted August 9, 2019 For the first time ever here have started to cut back,even my wife is talking about the strength of the baht .Sent from my SM-A720F using Thailand Forum - Thaivisa mobile app Link to comment Share on other sites More sharing options...
Mavideol Posted August 9, 2019 Share Posted August 9, 2019 5 minutes ago, ivor bigun said: For the first time ever here have started to cut back,even my wife is talking about the strength of the baht . Sent from my SM-A720F using Thailand Forum - Thaivisa mobile app we have been doing it for the past month or so already.... western foods reduced to a minimum or none, they became a luxury item Link to comment Share on other sites More sharing options...
ThaiBunny Posted August 9, 2019 Share Posted August 9, 2019 1 minute ago, Mavideol said: we have been doing it for the past month or so already.... western foods reduced to a minimum or none, they became a luxury item Heavens - my daily budget is usually less than 100 baht on what you would call the "luxury item" of "western foods". Muesli for breakfast, instant coffee + heated milk, or tea, two kinds of fruit from the street for lunch, and then lashing out on a Spanish omelette or scrambled eggs or some grilled chicken off the street and some baked beans or corn or similar for dinner. The other consideration is that Westerners typically eat about twice as much in quantity as they need to. I've never felt healthier than when I cut back on my intake Link to comment Share on other sites More sharing options...
Mavideol Posted August 9, 2019 Share Posted August 9, 2019 20 minutes ago, ThaiBunny said: Heavens - my daily budget is usually less than 100 baht on what you would call the "luxury item" of "western foods". Muesli for breakfast, instant coffee + heated milk, or tea, two kinds of fruit from the street for lunch, and then lashing out on a Spanish omelette or scrambled eggs or some grilled chicken off the street and some baked beans or corn or similar for dinner. The other consideration is that Westerners typically eat about twice as much in quantity as they need to. I've never felt healthier than when I cut back on my intake pretty much the same here, instant coffee milk, green salad, 1 or 2 eggs and dinner a 20 bath fried chicken leg, neighbors give some fruit from their garden or buy some bananas and since I am a no drinker/no smoker, we are doing ok for now Link to comment Share on other sites More sharing options...
ivor bigun Posted August 9, 2019 Share Posted August 9, 2019 We eat very little western food ,although as my wife and son lived in the UK for years they do like some sometimes,especially our son as he ate it as he was growing up and for school dinners.Still it is a worry as the pound really is so low.Sent from my SM-A720F using Thailand Forum - Thaivisa mobile app Link to comment Share on other sites More sharing options...
Ralf61 Posted August 9, 2019 Share Posted August 9, 2019 2 hours ago, ivor bigun said: For the first time ever here have started to cut back,even my wife is talking about the strength of the baht . Sent from my SM-A720F using Thailand Forum - Thaivisa mobile app 2 hours ago, Mavideol said: we have been doing it for the past month or so already.... western foods reduced to a minimum or none, they became a luxury item Khao Phansa anyway (no kidding) Link to comment Share on other sites More sharing options...
Isaan sailor Posted August 10, 2019 Share Posted August 10, 2019 Call it the BoT addiction to Chinese hot money short term bonds, complete with suspected kickbacks. To Hell with tourism, exports, expats and agri-Business. Hot money fix needed at BoT... Link to comment Share on other sites More sharing options...
NCC1701A Posted August 10, 2019 Share Posted August 10, 2019 20 hours ago, webfact said: The central bank’s assistant governor, Chantavarn Sucharitakul, on Friday issued the statement that the currency could move up or down wow. these guys are operating on a totally different level. Link to comment Share on other sites More sharing options...
Naam Posted August 10, 2019 Share Posted August 10, 2019 18 minutes ago, NCC1701A said: 20 hours ago, webfact said: The central bank’s assistant governor, Chantavarn Sucharitakul, on Friday issued the statement that the currency could move up or down wow. these guys are operating on a totally different level. sharp logic of these guys Link to comment Share on other sites More sharing options...
ivor bigun Posted August 10, 2019 Share Posted August 10, 2019 The baht could go "up or down" wow he must have studied at a great place of learning to have such insite into the currency market,i would never have thought of that.Sent from my SM-A720F using Thailand Forum - Thaivisa mobile app Link to comment Share on other sites More sharing options...
tlandtday Posted August 10, 2019 Share Posted August 10, 2019 So the guy is basically saying he doesn't have a clue what will happen. Predictable outcome from the pseudo science known as Economics. Link to comment Share on other sites More sharing options...
RichardColeman Posted August 10, 2019 Share Posted August 10, 2019 I get this awful feeling that the banks are encouraging more local bad loans as they don't have enough money to pay the interest on money flowing into the country without robbing foreign investor Peter to pay foreign investor Paul Link to comment Share on other sites More sharing options...
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