Thai Property News

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With the sudden weakening of the Baht last week, Anoma Srisukkasem of The Nation reported the central bank’s warning of currency volatility from risk aversion would continue if the sub-prime mortgage fiasco in the United States went unresolved.

The Bank of Thailand admitted it had intervened in the currency market late last week, warning importers not to bet that the Baht would simply continue to appreciate.

The Baht reversed from the appreciating trend of the previous few days to depreciate, opening at 33.99 to the US dollar, 0.21-per-cent weaker than the day before. The sudden weakening was caused by foreign investors shifting their money out of Asia, worried that Citigroup would be downgraded after the impact of sub-prime.

A wave of risk aversion - a phenomenon in which foreign investors draw their money out of emerging markets for fear of holding high-risk assets - could arise anytime, particularly after such an announcement by Citigroup. 

So….if you have got used to thinking of the Baht moving in a one-way direction, you may be disappointed - or again, pleasantly surprised - depending on your own position.  The Baht broke the critical level of 34 to the greenback on Wednesday and Thursday, due to a surplus in the current account and capital inflows.  

Good news if you’re looking to buy property in Thailand.  The combination of softening property prices and the weakening Baht and all this ahead of the election could mean the time is right.