Monetary policy to remain accommodative: BoT chief

Monetary policy to remain accommodative: BoT chief

Bank of Thailand governor Veerathai Santiprabhob
Bank of Thailand governor Veerathai Santiprabhob

Thailand's monetary policy will remain accommodative in the medium term and any rate increases will not be continuous, the central bank said on Monday.

There are more financial stability risks than inflationary pressure at the moment, Bank of Thailand (BoT) Governor Veerathai Santiprabhob told reporters.

"In the medium term, accommodative monetary policy is still needed. It's a misunderstanding that if rates increase, they will keep rising as in other countries," he said.

Any hikes will be "data dependent", he said, adding rates "may rise and stop".

The BoT's monetary policy committee wants to wait and see developments with the US-China trade war, inflation and economic growth, Mr Veerathai said.

Last week, the committee voted 5-2 to leave the policy rate unchanged at 1.50%t, with two members voting for a hike. Analysts viewed the vote as a hint of a rise soon.

The central bank is not worried about Thai and foreign interest rate differentials, as funds are still flowing into the country, Mr Veerathai said.

The governor said the central bank will ensure that the baht will not be too volatile. 


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