High noon for the Pound

[Rainsberger]

Hi Guys.

 

In just 20 mintues time the Bank of England are expected to announce

a interest rate cut of 0.5% but business leaders want a cut of 1% while

others want a cut of between 1% and 2% to kick start the economy.

This does not look good for the pound and already falling amounts of

Thai Baht we get only hope it does not go under 50 Baht for 1 pound.

Edited November 6, 2008 by Rainsberger

[Scumbag]

A couple of days ago the Australian interest rate was cut by 0.75% and its effect on the value of the dollar was next to nothing.

[culvers]

most investors would have already taken into account the near certain interest rate cut days ago, so the effect on the pound should be minimal i.e it has already fallen in anticipation of the rate cut

[Rainsberger]

Hi Guys.

 

In just 20 mintues time the Bank of England are expected to announce

a interest rate cut of 0.5% but business leaders want a cut of 1% while

others want a cut of between 1% and 2% to kick start the economy.

This does not look good for the pound and already falling amounts of

Thai Baht we get only hope it does not go under 50 Baht for 1 pound.

 

 

The Bank of England has cut interest rates by a massive 1.5% more

than expected which makes the Thai Baht likely to fall quickly against

the Pound. Tuff times ahead for us holiday makers in Pattaya.

Is it going to be a good Christmas and new year in Pattaya with less

to spend.

[missinginaction]

Just seen on the BBC website that the rate has been cut by a huge 1.5%....

[Scumbag]

.. which makes the Thai Baht likely to fall quickly against

the Pound.

You mean the Pound fall against the Baht!!??...

 

In addition to the 0.75% this month the Australian interest rate was cut by 1% last month so about the same as you guys.

[Captain Murgatroyd]

The falling value of the pound will have considerable implications for ex-pats on retirement visas. Many of them have fixed incomes that when coverted into Thai currency only just achieved the 65,000 baht per month required for their visa. At the beginning of this year, an income of 1,032 pounds was sufficient to qualify. As of todays banking rate, a further 150 pounds is required each month, 1800 pounds more each year...

 

If the pound/Baht exchange rate drops to the level it was at the time of Thailands financial crisis, (about 40 baht to the pound), then an ex-pat on a fixed income would not be able to remain in Thailand, as he would need to find almost an extra 600 pounds per month, or an extra 7,200 pounds per year.

 

Anyone qualifying on the basis of a lump sum, would have scraped in with 13,000 pounds in the bank last spring. They would now need 14,546 pounds. If the pound drops to 40 baht to the pound they will need a cool 20,000 pounds each year to qualify.

 

This decline in the pounds value would spell disaster for many British Ex-pats, who would be forced to either move to another country, where the qualifications are less stringent, or return home to the UK, homeless, and with little real prospect of obtaining decent employment. Their 13,000 pounds per year would berely provide enough money for a cheap bedsit and bills... their idyllic retirement hopes shattered. This represents a bigger problem than just having to make your holiday cash go a little further... So the next time you see an Ex-pat nursing his beer a little longer, and trying to spend less, they may not have started out as a cheap charlie, but have had the unfortunate status thrust upon them by dreadful circumstance...

[hazze]

I'm no economist.

 

But are we sure that a drop in UK interest rates will reduce teh value of the pound?

 

Investors looking to get the best interests rates will move their money away from pounds, which will put pressure on the pound to lose value.

 

But assuming and this is a bit assuming, this pacakage acts as a stimulus to the UK economy it may help to put an end to all the uncertainy over the UK economy which is making unattractive to have your money in pounds, putting pressure on the pound to go up in value?

 

Just a thought.

[culvers]

the cut seems bigger than expected, which i fear will mean the pound falls further.... Oh well as long as people can carry on buying studio flats for a million pounds when they earn 20k per year then everything will be ok...

[luv.you.long.time]

I agree there will be instability for the pound / baht this week, but I reckon it will not dip too much, maybe loose a few bahts again, then as confidence grows again then it'll be back to 56ish. I reckon by Jan / Feb we'll be at 60-62 and will stabilise there (Unless of course Mr Obama does something radical with the US markets - which I doubt very much).

Edited November 6, 2008 by luvyoulongtime

[CockSnot]

BBC Travel money are quoting 48.9 today - nice. Of course the interbank rate is better but it's not always so easy to get hold of..... :(

[Scumbag]

BBC Travel money are quoting 48.9 today - nice. Of course the interbank rate is better but it's not always so easy to get hold of..... :(

Just goes to show how much you get ripped off if you change money at home. Siam Commercial Bank was giving 53.84 for notes yesterday.

[sammy1958]

It looks like it is going to get worse. It annoys me when I see the pound losing its value.

[en184]

I think the pound will continue to fall until Gordon brown and his merry men leave office.

 

he has taken a decent country with a strong currency and is turning it into a Bolshevik country with a weak currency.

 

The UK is moving out of first world and into the third world.

 

 

Will blackpool become the next pattaya, as the pound falls into the abyss and UK ladies sell thier pussy cheap to earn hard currency.

[LongPlay]

I agree there will be instability for the pound / baht this week, but I reckon it will not dip too much, maybe loose a few bahts again, then as confidence grows again then it'll be back to 56ish. I reckon by Jan / Feb we'll be at 60-62 and will stabilise there (Unless of course Mr Obama does something radical with the US markets - which I doubt very much).

 

I would not bet on Obama not doing anything radical. Remember, in the US Senate, he was the holder of the dubious honor of being the farthest LEFT person in the whole Senate. Radical ( IE. Change ) was his ONLY platform. If anything, I would be betting on him doing something radical. He promised he would, and now is putting into place a cabinet that says to many that he plans to do it.

 

You guys from the UK, may be having a fair bit of company with new EXPATS running away with their hard earned cash to LOS to keep from having it taxed away to beer money. I for one, have a hope and plan for a 2 year batch of projects in Thailand starting sometime next year. I will be looking to extend that with every option I can find. 335 days outside the USA border makes me immune from his tax plans at the moment.

 

[marbella]

Thailand has 2 rates of exchange...........

 

Internal and external

 

The internal rate ,for foreign currency changed in Thailand is higher ,normally 5-10% more!!!

 

This makes a huge difference if you are buying a property.

 

It is best to send your home currency to a lawyer or developer and have it changed to bahts their Thai bank

[en184]

Yes, this was the case, but the offshore and onshore rates seem to have converged.

 

onshore

http://www.bangkokbank.com/Bangkok+Bank/We...es/FX+Rates.htm

 

offshore

http://www.bloomberg.com/markets/currencie...currencies.html