Baht What up with Dat?????

[bumper]

Well my problem is now the dollar not the baht. How did the Euro Pound fair thorough this?

[nel123]

Pound has lost about one baht in a week

[bumper]

Didn't go the way I expected at all. The SET caught fire with foreign money coming in. That ended up driving the baht back up I suppose, truly hard to call anything right now. Was my thinking that far off Jimbo?

[bumper]

Actually this is surprising to me, the FED already said they were going to do this. It wasn't unexpected. The off the cuff remark about raising interest rates in January, the economist I read today find that to be unlikely. The fact is at some time you have to pay the band.

http://www.bangkokpost.com/business/new ... e-increase

The Nation sees it differently

http://www.nationmultimedia.com/busines ... 29630.html

[bumper]

I've posted this twice a it effects both the baht rate and the Thai Economy,

http://www.bangkokpost.com/breakingnews ... te-outlook

[bumper]

Having visited Mr. Baht, in a long time, I think it was Parrot who said the 32 range. I think he was right.

http://www.bangkokpost.com/breakingnews ... hree-weeks

[JimboPSM]

Having visited Mr. Baht, in a long time, I think it was Parrot who said the 32 range. I think he was right....

While the last few weeks have shown repeated resistance to the Baht strengthening to 32.0, there is still (in my opinion) a low level of correlation between its movements with economic data and further revised down GDP forecasts

• 

Currently the only correlation that appears to make its way into the USD/THB rate are comments from Janet Yellen affecting market speculation about tapering

[bumper]

I believe you are right. I saw 32.47 on CNBC today. But. I also noticed the dollar was down compared to the Canadian Dollar.

Pretty good nick in the market today as well.

[bumper]

This indicates Asian shares were up today, That's not what happened here.

http://www.bangkokpost.com/most-recent/ ... -fed-signs

ล่าสุด เปลี่ยนแปลง มูลค่า
(ลบ.)
SET 1,379.02 -23.59 39,734.07
SET50 935.41 -16.11 24,289.67
SET100 2,051.21 -37.26 28,271.98
SETHD 1,117.20 -16.93 9,598.22

[Stantheman]

Does anyone think that the baht will devalue much more then it has now, 32.43 TT rate against the dollar at Bangkok Bank, with the upcoming demonstrations in Bangkok? Personally I think if not a lot of violence in the next few days the baht will not devalue much more then it has(not get above 33 to the dollar if that).

[JimboPSM]

Although the following is about the GBP, it could just as easily be about any other currency that is in the free (but still rigged) market; it should also be taken as a note of caution about venturing opinions about which direction a currency may be going as pretty quickly even those of us who are actually knowledgeable on the subject can look incredibly dumb

Today there was another example of how quickly the perversity and dangers to be found on the currency markets can make what, only a short time previously were perfectly valid and meaningful comments, look rather dumb.

This morning the UK released stronger than forecast manufacturing figures; they were strong enough for the following comments to appear on Bloomberg shortly afterwards:

Pound Set for Weekly Gain as U.K. Output Beats Analyst Estimates
By Eshe Nelson May 9, 2014 11:26 AM GMT+0100

Sterling headed for its fifth weekly gain versus its U.S. counterpart as the National Institute of Economic and Social Research raised its forecast for Britain’s growth. U.K. 10-year government bond yields rose above rates on similar-maturity Irish debt amid speculation the Bank of England is moving closer to raising interest rates while the European Central Bank considers adding economic stimulus.

“The positive pound momentum has continued this week,” said Lee Hardman, a currency strategist at Bank of Tokyo-Mitsubishi UFJ Ltd. in London. Sterling has been “supported by further evidence that the robust pace of growth in the U.K. is set to continue.” .......

However, even before the ink was dry on those comment the GBP had started to drop 0.5% against the USD (and against the THB) on the Forex markets turning the gain into a loss for the week.

So, moving on just 4 hours and 55 minutes the following updated comments appeared on Bloomberg:

Pound Falls Most in Three Months as Rally to 4-Year High Wanes

By Eshe Nelson May 9, 2014 4:21 PM GMT+0100

The pound declined the most against the dollar in three months as investors bet a rally that pushed the U.K. currency to a four-year high this week boosted the appeal of U.S. assets over those in Europe.

Sterling strengthened for a second week versus the euro after U.K. manufacturing production expanded more in March than economists predicted and the National Institute of Economic and Social Research raised its forecast for Britain’s growth. U.K. 10-year government bond yields rose above rates on similar-maturity Irish debt amid speculation the Bank of England is moving closer to raising interest rates while the European Central Bank considers adding economic stimulus.

“We did see a surge in cable this week but the move is really on its last legs of support levels,” said John Hardy, the head of foreign-exchange strategy at Saxo Bank A/S in Copenhagen, referring to the pound-dollar exchange rate. “The market is getting overextended and we are seeing a broad-based recovery in the dollar. The dollar got a boost because of the reaction to the ECB.”

The pound dropped 0.5 percent to $1.6848 at 4:19 p.m. London time, the biggest decline since Feb 3. It rose to $1.6996 on May 6, the highest since August 2009. Sterling was little changed at 81.66 pence per euro, having appreciated 0.7 percent this week, the biggest gain since the period ended April 18.

The Bloomberg Dollar Spot Index, which tracks the U.S. currency against 10 major peers, climbed 0.5 percent to 1,008.02 after dropping to 1,000.59 yesterday, the lowest since Oct. 28.

As an interesting aside, compare and contrast what is inside the two red rectangles:

• 

[bumper]

They go up and down everywhere that is for sure. Been a real learning experience for me.

as to this weekend their is still a possibility of an election. With that not sure if we will see a lot of violence this weekend. The PRDC is making hard moves for an appointed Government. I heard on Asian News this morning they are not approaching the Senate. My internet has been off all morning so just now catching up on news.

PRDC is successful I would think that would be the match to sit off the powder keg. It's far form over.

Will the effect the baht rate, Yingluck being removed effected it. in a small way. On the financial side of things, more then likely it will get worse for Thailand before it gets better. The statement by the BOT and the Former Finance MP says they have enough to ride it out. We may just find out.

Violence at this stage will harm them in a lot of ways. Credit ratings will fall, which mean the cost of borrowing money goes up. I'm not thinking we will see 56 to one as it once was. But, it may get a bit better for us.

Here's the news article this happens, not going to be pretty.

http://www.bangkokpost.com/most-recent/ ... suban-says

[pomps]

With martial law in place will the baht seriously weaken against currencies or not cannot remember how the Baht reacted to the coup back in 2006

[bumper]

The BOT has been very busy today it's going up and down like a yoyo 0630 32.62, down to the 32.40's on an off.

Have to wait for the dust to settle this knee jerk stuff

[Sakhonnick]

All this Gov stuff going on and the Baht Strengthens ???????????

[JimboPSM]

With martial law in place will the baht seriously weaken against currencies or not cannot remember how the Baht reacted to the coup back in 2006

The coup took place after the banks had closed in Thailand on the 19th September 2006 so the movement first shows on the 20th September.

While there was a kneejerk reaction on the 20th September it was actually less than 0.5% (as an aside, as is common with high degrees of uncertainty the forex spread taken by the banks did increase for the 20th); subsequent movements over the next few days were quite small and the forex spread reverted to normal.

This is USD/THB data for September and October 2006:

• 

This is a chart for July to December 2006; the blip from the coup on the USD/THB rate is clearly visible.

• 

On this chart from 2006 to date the blip from the coup on the USD/THB rate is barely discernible.

• 

Within two or three weeks the impact of the coup was relegated to just being a very small blip in the inexorable fall of the USD under the (stunningly fiscally incompetent) Bush Administration.

[bumper]

It's the BOT's mandate to keep the baht in control. They have foreign reserves to do that with. They are acting within the scope of their job, propping the baht up

[JimboPSM]

I rarely show charts with moving averages as I think most people are more interested in exactly where we are now; however using moving averages can be a useful tool in looking at historical movements as they help remove much of the noise (the peaks and troughs) that one experiences with “actual” currency charts which can disguise trends.

Below is a chart of the USD/THB from January 2010 showing that for the last three and a half years (with the exception of the distortion from early 2013) the 3 month moving average rate has been bouncing around for most of the time within a 2 Baht limit in an upward trend averaging 0.7 Baht per year (the trend and its limits are shown by the pair of blue dashed lines).

The 3 month moving average rate is the bright green line, the actual rate for comparative purposes is the black line and the interest rate differential between the BoT and the Fed is the dotted red line (a major factor in influencing exchange rate movements).

It clearly shows how the Baht movement in early 2013 (which looks suspiciously like manipulation) caused a major trend distortion which lasted almost nine months – which is far too much for even a 3 month moving average to contend with.

• 

Warning: while the chart shows a trend up to where we are today, I have very little idea about where it may go tomorrow - hence the big red question mark.

Sadly I have to admit that I have no crystal ball, I failed to qualify in crystal ball gazing, reading the entrails of sheep or even reading tea leaves all of which are absolutely necessary in order to be able to accurately forecast exchange rate movements unless, of course, one is in the position of being able to rig the market – such as hedge funds, investment banks, central banks, banks generally and sometimes, when really desperate, even governments get in on the act

[bumper]

Your not alone Moody's and the S&P credit ratings companies have mixed opinions. Personally I have no doubt that the Baht being manipulated at the moment. Set you tell me right back to 1405 today, defies all logic with Foreigners taking profits.

http://www.bangkokpost.com/most-recent/ ... t-negative

http://www.bangkokpost.com/most-recent/ ... it-ratings

ล่าสุด เปลี่ยนแปลง มูลค่า
(ลบ.)
SET 1,405.21 +2.29 41,281.00
SET50 950.59 +0.13 25,189.30
SET100 2,086.19 +1.62 31,002.98
SETHD 1,127.74 -2.04 13,142.76

[bumper]

sound like Moody's and the S&P may have to recalculate now.