Guest wowpow Posted November 26, 2007 Posted November 26, 2007 Thailand May Lift Capital Controls, RBS Report Says (Update1) By Yumi Teso Nov. 26 (Bloomberg) -- Thailand's central bank may lift its capital controls after national elections on Dec. 23, a move that may boost the currency by about 16 percent next year, Royal Bank of Scotland Plc said in a report. The Bank of Thailand imposed restrictions in December on foreign investment to curb currency gains, causing the baht to trade at a higher exchange rate overseas than in Thailand. Elections will help revive consumer confidence that has dropped to a five-year low following a military coup in September 2006. ``When they imposed the controls, there was a little bit of political turbulence, and now they are going to elect the new democratic government,'' said Chia Woon Khien, a local markets strategist for non-Japan Asia in Hong Kong at RBS. ``The currency will continue to improve.'' The baht was little changed at 33.82 onshore against the dollar as of 12:02 p.m. in Bangkok, while the currency gained 0.5 percent to 31.18 offshore, according to data compiled by Bloomberg...... Full article: http://www.bloomberg.com/apps/news?pid=206...&refer=home Quote
Gaybutton Posted November 26, 2007 Posted November 26, 2007 That may happen, but personally I doubt it. The exporters and tourist industries are already screaming about the current strong level of the baht. If the baht becomes even stronger, especially by a significant amount, then Thailand would only be seriously damaging its own economy even further. Also, the Bank of Thailand has a history of intervening if the baht is becoming too strong. On top of that, I have yet to see any of the economic predictions actually happen. At the moment of this posting, the US dollar to baht exchange rate is 33.65. Based on that, a 16% strengthening of the baht would drive the exchange rate to 28.27. I can't imagine Thailand wanting that to happen. I, for one, am not going to start glooming and dooming based on one economic forecast by one reporter. I'll do my glooming and dooming once such a situation actually exists. Quote
