Central bank foresees lower growth, says ‘still policy room’ to help economy

Central bank foresees lower growth, says ‘still policy room’ to help economy

Deputy Bank of Thailand Governor Mathee Supapongse (File photo, supplied)
Deputy Bank of Thailand Governor Mathee Supapongse (File photo, supplied)

The Bank of Thailand will lower its economic growth forecasts for this year and next and it still has monetary policy space to help the economy despite the key interest rate being at a record low, a deputy central bank governor said on Wednesday.

However, southeast Asia's second-largest economy is not in a crisis, as the country's economic fundamentals and banks remain strong, said Deputy Bank of Thailand Governor Mathee Supapongse.

The central bank will review its 2019 and 2020 economic growth forecasts - currently at 2.8% and 3.3%, respectively - at the next monetary policy meeting on Dec 18.

"They will likely come down, but by how much will depend on upcoming economic data," Mr Mathee told Reuters in an interview.

Last week's policy rate cut, the second in three months, prompted commercial banks to lower borrowing costs, and Mr Mathee said that should help the economy, purchasing power and inflation.

Although the policy rate is now at a record low of 1.25%, there is still room to help the economy if need be, said Mr Mathee, who is a member of the bank's policy committee.

"I think it's not a limitation that we have reached the bottom already," he said, adding that Thailand had no need to cut the key rate to zero.


Do you like the content of this article?
COMMENT (3)

China to remain biggest market over next decade

China will continue to be the biggest tourism market over the next decade, with arrivals estimated to reach 23 million, twice current figures, says Krungthai Compass Research Centre, a research unit of Krung Thai Bank.

18:11

Grand parade

The royal barge procession for His Majesty the King graces the Chao Phraya River, completing the royal coronation ceremony.

17:55

RFD chief asked to explain actions in Pareena land scandal

The House anti-graft committee will invite the head of the Royal Forestry Department (RFD) to explain what he is doing about the land-ownership scandal involving Palang Pracharath MP Pareena Kraikupt.

17:52