Yesterday’s sell-off by Thai exporters sank the US Dollar to a new 10 year low against the baht and some analysts are confidently predicting that the baht could hit 30 before year’s end. Worst the Bank of Thailand continues to support the dollar, despite the offshore value of the baht is in the 31 range.
The BOT governor blamed panic selling for the surge and warned that the baht will right itself through natural market forces. “Exporters should take a cautious approach, otherwise the baht will appreciate unnecessarily, which will create more damage for exporters in the end.”
Talk like that from the BOT should send the dollar through the floor.
Web bloggers are faulting currency speculation, capital influx, and the War in Iraq for the dollar’s demise. I don’t have a good idea why the baht is getting stronger against most every currency. I suspect someone has realized its vulnerability.
So what’s going to happen?
Nothing good for dollar holders.
At least not until the Bush regime is out of office and that isn’t for 16 months, unless they seize power for a 3rd term as forecasted by Jamie Parker.
“Help Mr. Wizard.”
Beer just got 3% more expensive in one day.
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