reader Posted October 3, 2023 Share Posted October 3, 2023 From The Nation Lack of clarity over the new digital-wallet scheme is weakening the value of the baht and could eventually become a hidden cost for the Thai government. Foreign investors have been selling Thai bonds and stocks since September, ahead of the anticipated distribution of 560 billion baht (US$15 billion) via 10,000-baht digital payments to every Thai over the age of 16. The baht's depreciation over the past month is peculiar, as it is not solely due to the strong US dollar. This is evident in the fact that the baht has weakened further than the currencies of Japan, South Korea, China, Taiwan, Hong Kong, Singapore, Malaysia, Vietnam and the Philippines. The baht plummeted past 37 per dollar on Tuesday morning, its lowest level in 11 months. The reason foreign investors have been selling Thai bonds at a faster rate than those of other countries in the region is twofold. First is the higher interest rate on the US dollar; second is that the market anticipates that Thai bond prices will fall in the future due to higher yields resulting from the government's 560-billion-baht digital handout. The expectation of falling bond prices has triggered a sell-off that has weakened the baht as investors take their money back home. And as the baht weakens, Thailand will need to spend more on importing goods, especially oil, a major cost for all industries in the country. Importers will also pay more for goods, extra costs that will be passed on to Thailand’s consumers. For example, iPhones here are becoming more expensive. Conversely, exporters who deal in dollars will benefit from the current situation. National banks are now likely to consider raising interest rates or implementing measures to maintain the stability of the baht. At the same time, large-scale projects such as the 560-billion-baht digital wallet scheme are putting more pressure on the baht's value. This means that the Thai government will have to borrow at higher interest rates to distribute the money. Meanwhile, with little clarity on details of the digital distribution plan, market concerns remain high, leading to sell-offs during this period of uncertainty. ====================== CROSS RATES AS OF POSTING USD 37.05 EUR 38.85 GBP 44.71 CAD 27.01 AUD 23.35 alvnv and KeepItReal 1 1 Quote Link to comment Share on other sites More sharing options...
vinapu Posted October 3, 2023 Share Posted October 3, 2023 those on the way to Thailand should be pleased with improved exchange rate Quote Link to comment Share on other sites More sharing options...
omega Posted October 3, 2023 Share Posted October 3, 2023 42 minutes ago, vinapu said: those on the way to Thailand should be pleased with improved exchange rate I'm not such a big spender nor penny pincher that I would neccessarily see the difference too much. It might pay for a massage... one without a HE. floridarob 1 Quote Link to comment Share on other sites More sharing options...
vinapu Posted October 3, 2023 Share Posted October 3, 2023 1 hour ago, omega said: I'm not such a big spender nor penny pincher that I would neccessarily see the difference too much. It might pay for a massage... one without a HE. still better to receive more for our buck , even if it's just coffee or BTS ticket to On Nut Quote Link to comment Share on other sites More sharing options...
omega Posted October 3, 2023 Share Posted October 3, 2023 15 minutes ago, vinapu said: still better to receive more for our buck , even if it's just coffee or BTS ticket to On Nut Oh absolutely agree with that, but I won't worry it too much. If the baht recovers just in time for my visit to LoS, then so be it... if it falls further, then so be it vinapu 1 Quote Link to comment Share on other sites More sharing options...
vinapu Posted October 3, 2023 Share Posted October 3, 2023 2 hours ago, omega said: Oh absolutely agree with that, but I won't worry it too much. If the baht recovers just in time for my visit to LoS, then so be it... if it falls further, then so be it you are right, after all baht is not a volatile currency as of now and rather no wild swings can be expected tm_nyc 1 Quote Link to comment Share on other sites More sharing options...
Members Lucky Posted October 3, 2023 Members Share Posted October 3, 2023 8 hours ago, vinapu said: those on the way to Thailand should be pleased with improved exchange rate Ha. Hotel rates have never been higher! Quote Link to comment Share on other sites More sharing options...
vinapu Posted October 3, 2023 Share Posted October 3, 2023 46 minutes ago, Lucky said: Ha. Hotel rates have never been higher! I noticed that. Somehow thay must make up for those 2 covid years. Quote Link to comment Share on other sites More sharing options...
floridarob Posted October 3, 2023 Share Posted October 3, 2023 8 hours ago, vinapu said: still better to receive more for our buck , even if it's just coffee or BTS ticket to On Nut Booking your ticket yet? Quote Link to comment Share on other sites More sharing options...
vinapu Posted October 4, 2023 Share Posted October 4, 2023 3 hours ago, floridarob said: Booking your ticket yet? still prices well over limit floridarob 1 Quote Link to comment Share on other sites More sharing options...
