Finance minister: no reason to raise policy interest rate

BANGKOK, Aug 8 (TNA) – Finance and Deputy Prime Minister Surapong
Suebwonglee on Friday indicated that he sees no need for a further policy interest rate increase because an inflation rate is unlikely to reach a two-digit level.

"I am in a group of people who believe the inflation rate will begin to
increase at a slower pace. So, it is difficult to see the repurchase rate
rise further unless the inflation rate reach a 2-digit level," he said at
a seminar on "Survival of Thailand Amidst Global Economic Volatilities."

However, he said he would allow the Bank of Thailand (BoT) Monetary Policy
Committee to decide on the matter of a further interest rate adjustment.

"As minister, I won't instruct the committee nor intervene in its decision
on the interest rate direction.

"But when the decision is made, I reserve my right to express an opinion
on whether I have agreed or not," he said.

On Thursday, the BoT deputy governor Atchana Waiquamdee said the bank
wanted to have a free hand regarding monetary policy implementation.

But she conceded the economic stimulus planning and macro-economic policy
making needed cooperation between the central bank and the Finance
Ministry.

The MPC is scheduled to meet August 27 after it decided to raise the
one-day repurchase rate by 25 basis points to 3.50 per cent, the first
time in two years, to constrain inflation.