The Baht's Troubling Rise

[Gaybutton]

If so, WHY trust them?

Personally I don't necessarily trust them, but I also have no reason to believe they are just making things up. Their accuracy - or lack of accuracy - doesn't really bother me unless it is a subject I think is important enough to care about. This topic, for example, whether the baht exchange rate is or is not wholly or partially responsible for driving away tourists - or if tourists are being driven away at all - is way down at the bottom of the list of things I care about. The only aspect of this I care about is whether the exchange rate is driving me away. So far, it isn't.

[Jun]

Correct, but when a local newspaper article is quoted, it is only fair to point out that they haven't checked the facts properly (yet again) & there is no basis for some of their claims.

Exchange rates certainly aren't driving me away either.

Moving on:
The Federal Reserve seems to have created some kind of exchange rate basket for the Thai baht. Apparently, the composition of the basket is trade weighted, but is not disclosed.
Note the effect of the Asian financial crisis and a reversion to a more normal range since then.

[Gaybutton]

it is only fair to point out that they haven't checked the facts properly (yet again) & there is no basis for some of their claims.

I would agree if I have some solid basis of my own to think they haven't checked the facts properly. The only way I can think of to do that is to check the facts myself. Maybe I'm just lazy, but I normally take the news article's word for it and I wouldn't know how to check the facts myself even if I wanted to. I usually accept what the articles say unless someone can show me solid evidence that what they say is incorrect and can provide what is correct - and where they got their own facts to dispute the articles.

[Jun]

I would agree if I have some solid basis of my own to think they haven't checked the facts properly. The only way I can think of to do that is to check the facts myself. Maybe I'm just lazy, but I normally take the news article's word for it and I wouldn't know how to check the facts myself even if I wanted to. I usually accept what the articles say unless someone can show me solid evidence that what they say is incorrect and can provide what is correct - and where they got their own facts to dispute the articles.

Well the article refers to European tourists counting notes at an ATM and then refers to a USD exchange rate as evidence. As we all know, the USD is not used in Europe. So that's the first red flag.
It's pretty easy to follow that up with a check on EUR-THB exchage rates, which seems just slightly better than the middle of the 10 year range.

But certain publications think the weak USDTHB exchange rate is the explanation. Should we accept that ?

[Gaybutton]

Should we accept that ?

Again, I don't care much whether we do or not. Maybe others do, but I see zero importance. People can easily check their own exchange rates for themselves. Whether the rate is putting them off or not, it's my idea of a "who cares?"

[Dodger]

You have made it clear that you don't trust the Thai news media. In Dodger I think we have someone whose judgment and qualifications can be trusted. I certainly do, especially now that I know what qualifies him.

Thank you for your very thoughtful comments.

[Jun]

Using school maths to calculate a standard deviation on forex rates is ahead of those who do no analysis. But there is a lot more to it than that.

Ray Dalio would be my idea of an expert & he certainly doesn't need to tell people he is one.

For some of our countries, debt and debasement appear to be the main medium term risks. National balance sheets today look quite different to 40 years ago, so there is a high risk of the future being quite different to the past.

Most FIAT currencies are temporary. I think there's at least one board member who comes from an area that's had 4 different currencies in just over 80 years. Not some tin pot country, but part of a leading G7 economy.

[Gaybutton]

I hope he gets his wish - and the sooner the better.
____________________________________

Bank of Thailand chief wants weaker baht

Vitai Ratanakorn sees room to cut interest rates to give sluggish economy a lift

by Reuters and Bloomberg

November 22, 2025

Bank of Thailand governor Vitai Ratanakorn said on Saturday that a weaker baht would be beneficial for the economy, and that there was room to cut interest rates if needed to support growth.

The baht has gained about 6% against the US dollar so far this year, becoming Asia’s second-best performing currency. The baht’s strength has posed a threat to exports and tourism.

“The central bank wants to see the baht weaken to an appropriate level that reflects the true state of our economy,” Mr Vitai told reporters at an event in Chiang Mai, without mentioning a specific level.

“I think the baht can weaken further,” he said, adding that the strength of the currency had been driven by a weaker dollar and Thailand’s current account surplus.

The baht in September hit a four-year high, partly because of its high correlation with gold.

The “baht situation should improve next year” with the country’s current account surplus expected to narrow, Mr Vitai said.

He also said there was room to lower interest rates if needed. “We’re reviewing the data. There is room for a further cut.”

The headline inflation rate in Thailand has been in negative territory for the past seven months. Policymakers have attributed continued price declines to supply-side factors, rather than weak demand.

The central bank’s Monetary Policy Committee left its key rate unchanged at 1.50% on Oct 8, after cutting it four times in the past year.

The next rate meeting is on Dec 17, and some economists expect a further reduction.

The Thai economy has faced multiple headwinds, including US tariffs, high household debt and the strong baht.

The economy expanded just 1.2% on an annual basis in the third quarter, the weakest pace in four years. Compared with the second quarter of this year, GDP contracted by 0.6%.

The central bank predicts the economy will grow 2.2% this year and 1.6% next year. Last year’s growth was 2.5%.

The government of Prime Minister Anutin Charnvirakul has set up a “Connect the Dots” task force to investigate irregular money flows that may be fuelling the baht’s unusual strength despite Thailand’s poor economy.

The government has said it will set up a special team to track suspicious fund movements linked to online gambling, scam accounts, and other “grey money” transactions.

The Bank of Thailand is ready to use its policy tools if speculators are attracted to the baht and causing distortions in the currency, Mr Vitai said.

But he cautioned that the central bank can only manage to reduce currency volatility, not reverse exchange-rate trends.

https://www.bangkokpost.com/business/ge ... eaker-baht

[Dodger]

The government has said it will set up a special team to track suspicious fund movements linked to online gambling, scam accounts, and other “grey money” transactions.

[Gaybutton]

The government has said it will set up a special team to track suspicious fund movements linked to online gambling, scam accounts, and other “grey money” transactions.

Where have we heard that before . . . ?