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99789
Wed, 01/13/2010 - 09:50
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http://m.oananews.org//node/99789
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Finance Ministry bonds won’t affect liquidity, says BoT
BANGKOK, Jan 13 (TNA) – The Finance Ministry’s plan to issue saving bonds valued at Bt5-8 billion at the end of the first quarter of this year will not tighten the country’s financial liquidity because money gained from the bond issue remains circulating in the system, according to the Bank of Thailand (BoT).
BoT Assistant Governor Suchada Kirakul said at present the excess liquidity in the system is four times higher than required. In other words, liquid assets owned by commercial banks stand over Bt2 trillion.
She said the central bank had no plan to issue saving bonds in the first quarter of this year given the Finance Ministry’s planned bond issuing. “We will take into account the liquidity in the market for a bond issuing plan. Should the liquidity be tightened, we will issue bonds in a smaller amount. Now, we don’t have sufficient tools to oversee the liquidity,” she said.
Commenting on the capital inflow at present, Mrs Suchada said most capital comes from foreign direct investment, purchases of shares of financial institutions, and bond purchases.
Currently, she noted, interest returns from bonds worldwide are considered lowest, depending on the interest adjustment period of each country.
Mrs Suchada said interest returns in Thailand remain higher than those of many other countries.
The interest returns on 10-year bonds and 2-year bonds in Thailand stay at 4.2 and 2 per cent while those on the 2-year bonds overseas are 1 per cent, she pointed out.
Thailand had put in place the capital market development plan, which could attract foreign investors, she said, believing that more foreign capital would return to Thailand. (TNA)
BoT Assistant Governor Suchada Kirakul said at present the excess liquidity in the system is four times higher than required. In other words, liquid assets owned by commercial banks stand over Bt2 trillion.
She said the central bank had no plan to issue saving bonds in the first quarter of this year given the Finance Ministry’s planned bond issuing. “We will take into account the liquidity in the market for a bond issuing plan. Should the liquidity be tightened, we will issue bonds in a smaller amount. Now, we don’t have sufficient tools to oversee the liquidity,” she said.
Commenting on the capital inflow at present, Mrs Suchada said most capital comes from foreign direct investment, purchases of shares of financial institutions, and bond purchases.
Currently, she noted, interest returns from bonds worldwide are considered lowest, depending on the interest adjustment period of each country.
Mrs Suchada said interest returns in Thailand remain higher than those of many other countries.
The interest returns on 10-year bonds and 2-year bonds in Thailand stay at 4.2 and 2 per cent while those on the 2-year bonds overseas are 1 per cent, she pointed out.
Thailand had put in place the capital market development plan, which could attract foreign investors, she said, believing that more foreign capital would return to Thailand. (TNA)
