currency update

[ikarus]

There is a remarkable strengthening of US dollar versus major currencies at the moment including Thai baht. This is, however, not te dollar rebound many people expect. The current strengh is temporal and based on impression that Fed may pause in cutting interest rates. US in recession which continues deepening and Fed will continue to cut. On the contrary, ECB is still not in cutting mood yet. The current situation presents excellent opportunities for selling dollar on temporal strength. My favorite currency in the long to medium run is Aussi dollar.
I would like to call your attention to spectacular slide of Korean won which lost something around 40 percent versus Jap Yen within the span of several monthes. It is a collapse of Korean won and Thai baht in 1997 which manifested a great crisis in South East Asia. While the current situation is quite different there is a certain similarity in key economic indicators between these two countries.
Do not take wrong. The dollar will rebound when Fed reverse the course and/or ECB starts to cut but it is not on the cards
for quite a while.
A good short term play is Jap Yen which may sterngthen from current levels to 98-99 versus dollar. But in the longer run I definitely prefer Aussi dollar.

[cottmann]

.....A good short term play is Jap Yen which may sterngthen from current levels to 98-99 versus dollar. ......

Given the report earlier this week that the BOJ is unlikely to raise interest rates this year, this is unlikely.

[ikarus]

.....A good short term play is Jap Yen which may sterngthen from current levels to 98-99 versus dollar. ......

Given the report earlier this week that the BOJ is unlikely to raise interest rates this year, this is unlikely.
We will see. Yen value is not determined by interest rates. If this were the case, we would not have seen quite spectarcular Yen appreciation recently (which, by the way, I correctly predicted). When Yen will reach 99, I will return to the thread.

How do you guys move funds from one currency to another currency? remember the bank interest rate for each currency is very different. When you move currency, you need to take the interest rate into consideration.

Also, a foreign bank's interest rate is lower than the currency's own country interest rate. For example, U.S. dollar currency gets about 3% from one year CDs in the U.S. now, but in Singapore, the U.S. dollar currency only gets 2% (or even less) from U.S. dollar currency CDs.

[Brad the Impala]

There is a remarkable strengthening of US dollar versus major currencies at the moment including Thai baht.


Perhaps you could show us how this applies as my understanding of the Bangkok Bank rates show only a 1% increase against the Baht over the last month, and an overall 1.5% increase over the last two months. Given the falls of the dollar against all currencies, including the baht, over the last year, and the fact that despite the small increases in value over the last two months, the dollar is currently down 3% against the Baht as against three months ago, the small increases recently could hardly be classed as " remarkable strengthening", and barely qualify as dead cat bounce.



www.bangkokbank.com/bangkok+bank/personal+banking/foreign+exchange/fx+rates/default.htm (http://www.bangkokbank.com/bangkok+bank/personal+banking/foreign+exchange/fx+rates/default.htm)