ID :
146765
Wed, 10/20/2010 - 10:15
Auther :
Shortlink :
http://m.oananews.org//node/146765
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Central bank urged to be more flexible in deciding policy interest rate
BANGKOK, Oct 20 – The Bank of Thailand (BoT) should consider surrounding factors with prudence and caution in implementing monetary policy and be more flexible in deciding the policy interest rate at the Monetary Policy Committee meeting on October 20, according to a leading academic.
Currently, Montree Socatiyanurak, director of the Executive MPA Program, National Institute of Development Administration (NIDA), said that the global economic and financial system had changed rapidly.
The decision by the central bank on the policy interest rate to strictly adhere to the rule might put Thailand at disadvantage if all parties concerned failed to adjust in a timely manner, he said.
“The central bank may opt to maintain or reduce the policy interest rate in order to alleviate impacts of the stronger baht, but it should not change the monetary policy rapidly and at the same time the MPC should meet specially in addition to that held every six weeks to keep up with the situation,” said Dr Montree.
He said the inflation rate is considered appropriate given the country’s current economic growth rate.
The core inflation rate, at 1.2 per cent now, is rather low. The BoT decision to raise the policy rate twice in past meetings was justified.
He believed the United States would go ahead with the low interest policy and issue more banknotes. It is expected currencies in Asia including the baht would be affected one more time.
Because of this, the central bank must give weight to properly supervising inflation rate and the baht value properly to ensure the overall economy is not affected, he added. (MCOT online news)
Currently, Montree Socatiyanurak, director of the Executive MPA Program, National Institute of Development Administration (NIDA), said that the global economic and financial system had changed rapidly.
The decision by the central bank on the policy interest rate to strictly adhere to the rule might put Thailand at disadvantage if all parties concerned failed to adjust in a timely manner, he said.
“The central bank may opt to maintain or reduce the policy interest rate in order to alleviate impacts of the stronger baht, but it should not change the monetary policy rapidly and at the same time the MPC should meet specially in addition to that held every six weeks to keep up with the situation,” said Dr Montree.
He said the inflation rate is considered appropriate given the country’s current economic growth rate.
The core inflation rate, at 1.2 per cent now, is rather low. The BoT decision to raise the policy rate twice in past meetings was justified.
He believed the United States would go ahead with the low interest policy and issue more banknotes. It is expected currencies in Asia including the baht would be affected one more time.
Because of this, the central bank must give weight to properly supervising inflation rate and the baht value properly to ensure the overall economy is not affected, he added. (MCOT online news)
