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Baht hits seven-year high of 36.40
Report from Bangkok Post dated Wednesday 15 November 2006 :-
Baht hits seven-year high of 36.40
The baht rose to a seven-year high yesterday, as capital inflows helped push the unit to as much as 36.4 against the dollar.
Dealers said the baht, which has gained 11.2% against the dollar this year, rose to 36.41 in intraday trade before easing on profit-taking and intervention fears.
The baht closed at 36.400/430, compared with 36.50/52 on Monday.
''The Bank of Thailand intervened steadily throughout the day to help keep the baht over 36.4,'' one local dealer said.
''The baht is gaining not only due to steady capital inflows, but trade surpluses on export earnings.''
Dealers said the baht would next see resistance at 36.30 to the dollar, a level last seen in 1999, although based on current trends, the baht was likely to hit 35 before the end of the year.
The baht traded in a narrow range around 25 to the US dollar up until July 1997, when speculative pressure and a host of domestic factors forced the central bank to float the currency. The event triggered an Asia-wide financial crisis and the baht hit 56 in January 1998 before beginning a slow but steady recovery.
Compared with the end of October, the baht is 3.05% stronger against the dollar, versus a 2.09% gain against the euro and 2.88% against the Japanese yen.
According to the central bank, non-bank capital inflows in the first eight months of the year totalled $9.72 billion baht, including $4.1 billion in direct investment, $890 million in debt capital and $3.86 billion in investment capital.
--- KatoeyNewsNetwork
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