Reader question: Which way is the development of the Thai baht – euro exchange rate going?

With the QE by the ECB, which will start in March, an additional 60 billion euros will be added to circulation every month. More Euros with nothing extra in return means a lower price. The chance that the Euro will continue to fall is therefore very high. The same will happen with interest on savings in Euros. With a declining Euro, the Baht rises in value.

Those who really know how the prices of currencies and / or shares will develop in the future, lie on a tropical private island enjoying the sun, sea, etc.

In short, no one can make a reliable prediction.

Money is nothing more than solidified trust in a medium of exchange: that someone else returns other goods against that medium of exchange (silver and gold coins, or government-guaranteed paper to .. lines in a computer program).
The moment that confidence drops, and people massively convert their medium of exchange into another (paper for gold, DMs for US$, or Rubles in Euros/US$, and the supply is therefore considerably higher than the demand, the If that goes fast and a lot, others will do the same in a panic and the exchange rate will fall (Ruble to US$/Euros).
There are a few major currency blocks: US$ (including Chinese Yuan, Thai Baht), Euro, Yen. And that's about it.
If confidence in the Euro decreases, and people exchange their money for US$, the Euro will also yield less THBs (as long as this lasts).
As soon as stability is established along the Euro (calm in Ukraine, problem Greece neutralized, reduced influx of refugees), the “lemmings” behavior can go the other way again, and US$ (and THBs) will be converted into Euros .

When, in the 80s, I attended a lecture block on these currency situations at the UVA, the professor was asked at the end: all this is nice, but… “what will the exchange rate of the US$ be next week, month etc..” came the answer: “for the exchange rate of the US$ against the European currency, you should not go to the Faculty of Economics, but to Psychology”.
To give you an idea: the Bundesbank had a "war chest" of DM 3 billion to keep the US$ from crossing the DM 3 border. Daily currency flows then amounted to… 1000 billion US$ per… day.
So that "war chest" had dried up in a few days, and the US$ went up to DM 3,35.

The enormous expansion of the money market by Draghi of up to EUR 1100 billion (at EUR 60 billion/day) is therefore… compared to the annual income of the entire EU of EUR 17,000/yr.. only.. 65 days of income. Looking at the total debt… do you really think that the consumer will be sent in a completely different direction with an increased borrowing capacity of… 2 months salary? (Your mortgage + Personal loan space has been increased by € 5000?)
However, if CONFIDENCE goes the other way, THEN that “loan” will be taken up, and much more, and the economy will change, and thus confidence in the exchangeability of the Euro will change.

In other words: as soon as you know when that TRUST is going to turn, THEN exchange money.
And since economists still haven't fitted psychology into their frame of mind, people keep beating around like half blind.

For MY business activities: I buy in THB, among other things, of which the goods have now become 15-20% more expensive in Euros. So.. customers who switch to other products. Nevertheless, I keep my currency open, because I expect (hope) that the Euro will strengthen considerably again in the coming months
( and like so many prophets I eat bread, or: have zero future predictive ability )

also here in Thailand they experience the negative consequences of a too strong Thai bath.
Last Wednesday there was a TV debate about this on the Thai channel between various departments. It will be investigated how to deal with and how to make the Thai bath less strong, don't forget Thailand exports a lot to Europe, so export volume is falling, which in turn results in poorer economic growth and less tax revenue. Exports have been declining for at least 1 year and that has to stop was the conclusion.

So it is difficult to say which way it will go, if the Thai government does nothing, it will certainly go to 30 to 32 baht on the euro because so many Euros are being pumped into a failing system. European equities are expected to rise as a result, so make up for the price difference there. Even if the USA raises interest rates, a lot of money will flow from the USA to Europe, so that a bubble will also arise on the shares there. The trend has already started, I also invest myself and this year alone a growth in the portfolio of more than 10%, is only due to low interest rates and a lot of capital, which is placed by banks and big boys, but also from the USA .

It's not surprising after many years of a te
strong euro, a correction is now underway.
That we as tourists or pensionados are not really there
happy with it is an understatement.
America with its cheap shale oil and stronger dollar is no stranger to this.
Unfortunately, we don't know what the future will bring.
Simply enjoy this country, even if it is with some
with a few baths less.

Analysts have been predicting for years that the dollar will be worth as much as the euro. At the moment it doesn't make much difference, so assume that you will get +\- 33 bath for your euro in the coming years.

Since there is almost unanimity that the euro will soon be worth as much as the dollar, why not exchange your euros for dollars now?
Then you will soon have won more than 10%, right?
If it were that simple….then everyone with a decent capital would be rich, wouldn't they?
Personally, I do think that we will evolve to 32 rather than 40 baht and then higher again when the economy in Europe recovers.

What about if we first take a closer look at next year, because starting with the ASEAN conference the language problem the various currencies I have already been told that Indonesia already has the dollar Laos they also love the dollar vetnam dollar yes and there are more with dollars, maybe we will also get the dollar here because we all talk about the euro but what about the english pound the australian dollar and so on, people in thailand also see it gloomy in what is yet to happen, but first let's see what is happening in the EU because one thing is certain that 1 billion per month will not reach the consumer but will end up with the banks, I suspect that they will spend a little more to boost when more countries die , that is my sights on the game what is played by the / yank / moscou and the eu the game of the greats , we will see
who wins the game, but there is no one who still takes into account a war in Europe, Ukraine and Russia, very dangerous, not to mention the Syrian danger.

Make sure to convert some of your Euros to USD and some gold (or gold mines).
Furthermore, I think it will not be long before the Thai Central Bank lowers interest rates, and perhaps also prints money that will lower the Bath, in order to stimulate exports….

All central banks from Canada to Australia, Japan to Denmark, are doing it…so it's suicidal not to get involved.