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What's your baht worth? Exchange rates on the street...


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https://pattayaone.news/thai-baht-is-facing-a-reversal/?fbclid=IwAR1qug7Zkq351jdOdCafr9B4cAm-Cyroqm8QUvDHKB592azOfadkCP-u7Qc

The Thai baht’s heady gains are petering out, thanks to slowing growth and a central bank that’s bent on taming the currency’s strength.

After clocking an 8 percent rise this year, Asia’s best-performing currency is losing momentum as easing United States-China trade tensions damp its appeal as a haven. Falling yields on local bonds and equity outflows are adding to the pressure.

The baht has defied the broad weakness in regional currencies as investors sought refuge in Thailand’s safe but low-yielding debt.

A hefty current account surplus and a sizeable pile of foreign reserves helped reel in global funds.

But, the tide has started to turn. The baht has climbed just 0.1 percent in December, making it the region’s worst-performing currency.

It has dropped 0.2 percent to around 30.2 per US dollar since rallying to the strongest in more than six years in October.

The baht may continue this underperformance if US-China trade relations improve further as Bloomberg’s analysis of 19 emerging-market currencies shows it’s among those that are least responsive to the yuan’s move.

The baht’s retreat in December came as the central bank lowered its economic growth forecasts, citing global risks.

November trade data due Monday may confirm the slowing trend, with the nation forecast to have recorded its first trade deficit since April as both exports and imports shrank.

The baht is expected to decline 1 percent to 30.5 per US dollar by end-2020, a performance that would put it behind all but three of its Asian peers, according to a Bloomberg survey of analysts.

If Thailand’s growth weakens, this could fuel further selling in Thai stocks and weigh on the baht.

The 12-month foreign outflow from domestic equities is already above the five-year average.

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https://www.chiangraitimes.com/economy-business/thailands-prime-minister-orders-quick-action-on-thai-baht/
 

Thailand’s Prime Minister Prayut Chan-o-cha has ordered authorities to immediately stabilize the baht value and control its rise. He also ordered the Finance Ministry to form a new committee for the task.

Finance Minister Uttama Savanayana said Gen Prayut made the order as baht appreciation was affecting exporters. Many groups of operators in exports and tourism has pressured the PM over the soaring baht.

There will not be any order for a particular direction of the baht value, Mr Uttama said. That is the responsibility of the Bank of Thailand. The new committee idea will be proposed to a meeting of economic ministers. It will be a forum for organizations to exchange information,” he said.
 

The Finance Ministry will form the baht stabilization committee together with the Bank of Thailand; the National Economic and Social Development Council; the Office of the Insurance Commission; and the Stock Exchange of Thailand.

The Finance Ministry also plans to set up another committee to implement national strategies. Concerning small and medium-sized enterprises, start-ups and the grassroots economy. Furthermore so that the strategies would significantly boost the economy.

Central Bank Trying to Curb Baht

Thailand is trying to coax the baht down from six-year high territory as the currency’s strength threatens local manufacturing and tourism.

The central bank has cut interest rates and eased capital controls to rein in emerging Asia’s best-performing currency this year.

It is an ironic twist for a country that became the epicenter of the 1997 Asian financial crisis after its currency collapsed. Thailand now finds that its relatively sound fundamentals have made it a safe haven for capital in Southeast Asia.

The bank cut its benchmark one-day repurchase rate to 1.25%, tying an all-time low, while also making it easier to take funds out of the country.
 

 

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