Baht Hits One-Week Low as Flood Hurts Exports, Greece Calls Vote
The government said yesterday it may take 45 days to pump water from inundated industrial estates north of Bangkok once flooding recedes, and total damage claims from the disaster may total 217 billion baht ($7 billion). Asian stocks declined today after Greece’s government called a referendum on its latest bailout package from the European Union, a move that may escalate the region’s debt crisis.
“The flood is really going to affect Thailand’s growth, I’m cutting my 2011 growth forecast by as much as three percentage points,” said Frances Cheung, a Hong Kong-based strategist at Credit Agricole CIB. “Greece’s referendum will further hurt the EU’s credibility and it’s undermining market sentiment.”
The baht traded at 30.90 per dollar as of 8:29 a.m. in Bangkok, little changed from 30.89 yesterday, according to data compiled by Bloomberg. It touched 30.95 earlier, the weakest level since Oct. 24. Cheung predicts the currency will fall to 31.20 by year-end.
Auto production in Thailand this year is expected to fall 17 percent short of the industry’s target as the floods disrupt supply chains and halt output, according to a Federation of Thai Industries estimate.
The yield on the government’s 5.25 percent bonds due May 2014 rose two basis points, or 0.02 percentage point, to 3.19 percent, according to data compiled by Bloomberg.
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