ID :
115864
Sat, 04/10/2010 - 11:54
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http://m.oananews.org//node/115864
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Mounting political tension begins affecting financial sector: BoT
BANGKOK, April 10 (TNA) – Bank of Thailand (BoT) Deputy Governor Bandid Nijathaworn on Friday conceded that the country’s mounting political uncertainties had begun to impact the financial sector as could be witnessed by the plunge in the Stock Exchange of Thailand (SET) composite index on Thursday’s trading.
In the past two weeks, political rallies by Red Shirt protesters had affected the economy, particularly the financial sector, to a limited extent, he said, but at present, the political situation has worsened and it is difficult to predict when it will end. Increasing political uncertainties had begun to dampen stock market investments as foreign investors began sell stocks after a few weeks of declining purchases.
He said the ongoing political standoff had already affected tourism, consumer activity and business confidence, which are three key factors for economic recovery.
Should the situation be prolonged, it would definitely affect the economy in the long run.
The persistent rallies, Mr Bandid said, would lead to the downgrading of the Thailand’s sovereign position due to political instability. Such a downgrading would fuel overseas borrowing costs, affecting the continuity of economic policy implementation and making it more difficult to carry out an economic plan.
In addition, he said, the prolonged rallies would affect business confidence and lead to an investment suspension. It would impact Thailand’s economic growth potential in the long run.
However, he said, the Monetary Policy Committee would give a priority to outlining a monetary policy useful for economic stability and continuing recovery. (TNA)
In the past two weeks, political rallies by Red Shirt protesters had affected the economy, particularly the financial sector, to a limited extent, he said, but at present, the political situation has worsened and it is difficult to predict when it will end. Increasing political uncertainties had begun to dampen stock market investments as foreign investors began sell stocks after a few weeks of declining purchases.
He said the ongoing political standoff had already affected tourism, consumer activity and business confidence, which are three key factors for economic recovery.
Should the situation be prolonged, it would definitely affect the economy in the long run.
The persistent rallies, Mr Bandid said, would lead to the downgrading of the Thailand’s sovereign position due to political instability. Such a downgrading would fuel overseas borrowing costs, affecting the continuity of economic policy implementation and making it more difficult to carry out an economic plan.
In addition, he said, the prolonged rallies would affect business confidence and lead to an investment suspension. It would impact Thailand’s economic growth potential in the long run.
However, he said, the Monetary Policy Committee would give a priority to outlining a monetary policy useful for economic stability and continuing recovery. (TNA)
