Calls grow louder for action on baht

[Bangkoktraveler]

The US gov prints the treasury notes then they get sold to whoever (China, etc).

They are fiat, unbacked bonds (notes, whatever).

 

[color:red]No matter, you can NOT drink yourself sober nor can you borrow your way out of debt[/color].

 

 

A wise man speaking.

[cavanami]

...back to the Baht...buzz is that by the end of this week or early next week, we will see a weakening of the Baht

 

....fingers crossed...

[Sporty]

Japan Plans Intervention to Stem Rise in the Yen

By HIROKO TABUCHI

Published: September 10' date=' 2010

 

TOKYO  The Japanese government is gearing up to intervene in global currency markets to curb a strengthening yen, Prime Minister Naoto Kan said Friday, signaling an effort to limit further damage to Japan’s export-led economy.

 

(More) http://www.nytimes.com/2010/09/11/business/global/11yen.html?src=busln

 

[color:red']One Analyst, expected it by the end of next week, but I heard that before, too.[/color]

 

Forget it. IMHO

 

 

BOJ, has just intervened in the currency, 1.5% immediate FX move, details, have yet to be announced.

 

 

[LizardKing]

...back to the Baht...buzz is that by the end of this week or early next week, we will see a weakening of the Baht

 

....fingers crossed...

LOL! You must get your "buzz" from the same place as your other tin-foil nuttiness.

 

All the Thai finance guys I know are predicting as strong as 29.50 by year end...

 

The yen, on the other hand, *will* be getting weaker. Steps have already been started to make that happen (like the J Finance Minister telling China to stop buying J financial instruments).

[kamui]

Japan Plans Intervention to Stem Rise in the Yen

By HIROKO TABUCHI

Published: September 10' date=' 2010

 

TOKYO  The Japanese government is gearing up to intervene in global currency markets to curb a strengthening yen, Prime Minister Naoto Kan said Friday, signaling an effort to limit further damage to Japan’s export-led economy.

 

(More) http://www.nytimes.com/2010/09/11/business/global/11yen.html?src=busln

 

[color:red']One Analyst, expected it by the end of next week, but I heard that before, too.[/color]

 

Forget it. IMHO

 

 

BOJ, has just intervened in the currency, 1.5% immediate FX move, details, have yet to be announced.

 

 

Yup, I just read it too at BBC News .

 

And I am quite surprised.

The central bank stepped in to sell yen and buy dollars, a day after the yen hit a 15-year high against the dollar.

 

It is the first time in six years that the Bank of Japan has intervened, and further action has not been ruled out.

 

A strong yen makes Japanese exports more expensive, and reduces profits when earnings are repatriated.

 

In early trading on Wednesday, the dollar rose to 85 yen, after hitting 83.09 yen on Tuesday.

 

Investors welcomed the intervention, sending Japan's Nikkei share index up by 2.9% at first, with the index eventually closing 2.34% higher at 9,516.56.

 

The yen had spiked after news filtered through that Prime Minister Naoto Kan had survived a leadership challenge from rival Ichiro Ozawa.

 

Traders had reckoned Mr Kan would be less likely than Mr Ozawa to take measures to weaken the yen.

 

[LizardKing]

[color:purple]Last week Japan’s minister of finance declared that he and his colleagues wanted a discussion with China about the latter’s purchases of Japanese bonds, to “examine its intention† diplomat-speak for “Stop it right now.†The news made me want to bang my head against the wall in frustration.

 

You see, senior American policy figures have repeatedly balked at doing anything about Chinese currency manipulation, at least in part out of fear that the Chinese would stop buying our bonds. Yet in the current environment, Chinese purchases of our bonds don’t help us  they hurt us. The Japanese understand that. Why don’t we?[/color]

 

Linkage...

[cavanami]

My source of the buzz is Bill, a somewhat regualr at the Texas that works for a large financial house here in Bangkok...sorry, no Tin Hat needed on this one...but you are welcome to borrow the Tin Hat, as needed

 

Sounds like it might be a big night at Cabos on Friday...be there or be square...

[ThaiHome]

The BOT was spreading the rumor it is thinking of putting in place currency controls like they did a few years ago (which caused the biggest one day crash in SET history).

 

That word alone slowed the inflows and caused the baht (and SET) to weaken a bit earlier this week. The BOT then announced they would not put controls in place, but will continue the sterilized intervention they have been doing all along.

 

I think the BOT will start selling lots of baht and increasing the money supply (non-sterilized intervention), which will increase the chance of inflation but at the same time heat up the economy even more, which for a government facing an election sometime in the next year will not be a bad thing,

Central bank governor shoots down capital control rumours

TH

[cavanami]

Mr. Pea Brain here just thinking a bit...the Baht is the second hottest currency in Asia, the Yen being number one.

Since at the present the Baht is a good investment, then people will be buying all the Baht they can, then does supply/demand kick in, causing the Baht to get stronger?

 

If the Thai gov injects more Baht into the marketplace, will there be more Baht bought up? or will this weaken the Baht?

 

Doesn't make much sense to me but I think the Baht will stay strong or even get a little stronger

[ThaiHome]

Most Currencies are commodities, and like you say the price is subject to supply and demand. When the BOT injects more baht into the market by selling baht (and getting mostly USD, hence the ever growing foreign reserves) they cause the price to go down.

 

Here is a pretty good explanation of Central Bank intervention and the effects.

Link

TH