ID :
98606
Thu, 01/07/2010 - 09:30
Auther :
Shortlink :
http://m.oananews.org//node/98606
The shortlink copeid
BoT likely to maintain policy interest rate, says top forecaster
BANGKOK, Jan 7 (TNA) – The Bank of Thailand (BoT) Monetary Policy Committee (MPC) is expected to keep the policy interest rate unchanged at its meeting on January 13 since it sees no need to raise the one-day repurchase rate (repo) for the time being, according to the Thai Chamber of Commerce Economics and Business Forecasting Center.
Center director Thanawat Polvichai said the MPC is likely to maintain the repo at 1.25 per cent because of three factors.
First, the inflation rate continuing to remain lower than 2 per cent, within the inflation target range of 0.5 per cent to 3 per cent.
The general inflation rate in December stood at 3.5 per cent, which is not so high that a repo hike is required. The Thai economy has just begun to recover, so pressure from an inflation rise is not so high.
Second, the central bank still needs to see the baht stay at its current level of 33 baht +/- because it can support Thailand’s export growth and economic recovery.
An interest hike might make the baht become stronger, which is an obstacle to exporters. In addition, the United States Federal Reserve still remains its interest rate unchanged, so it is unnecessary to raise Thailand’s policy interest rate at present.
Finally, the low interest rate could have a positive psychological impact as it would help lower the private sector cost and encourage investment and consumption. (TNA)
Center director Thanawat Polvichai said the MPC is likely to maintain the repo at 1.25 per cent because of three factors.
First, the inflation rate continuing to remain lower than 2 per cent, within the inflation target range of 0.5 per cent to 3 per cent.
The general inflation rate in December stood at 3.5 per cent, which is not so high that a repo hike is required. The Thai economy has just begun to recover, so pressure from an inflation rise is not so high.
Second, the central bank still needs to see the baht stay at its current level of 33 baht +/- because it can support Thailand’s export growth and economic recovery.
An interest hike might make the baht become stronger, which is an obstacle to exporters. In addition, the United States Federal Reserve still remains its interest rate unchanged, so it is unnecessary to raise Thailand’s policy interest rate at present.
Finally, the low interest rate could have a positive psychological impact as it would help lower the private sector cost and encourage investment and consumption. (TNA)
