Banks asked to freeze rates - finance minister

Banks asked to freeze rates - finance minister

Street food vendors in front of CentralWorld shopping plaza in Pathum Wan district, Bangkok, on July 30, 2022. (Photo: Wichan Charoenkiatpakul)
Street food vendors in front of CentralWorld shopping plaza in Pathum Wan district, Bangkok, on July 30, 2022. (Photo: Wichan Charoenkiatpakul)

Commercial banks should not rush to raise their interest rates even though the Bank of Thailand (BOT) will tighten monetary policy, Finance Minister Arkhom Termpittayapaisith said on Wednesday.

The central bank is widely expected to raise its key rate for the first time in nearly four years later on Wednesday.

The economy remains strong and can cope with any wage increases later this year, Mr Arkhom told reporters.

Earlier, heads of state banks said they would try to hold their interest rates steady for as long as they could so customers would not be impacted by a policy rate hike.

Some business sectors are concerned about the effect of the BOT's anticipated interest rate hike on companies and the public, while related private and state organisations have vowed to do their best to help them alleviate the impact.

Earlier, the Federation of Thai SMEs expressed its concern about a higher policy rate and is calling for authorities to prepare measures to help small and medium-sized enterprises (SMEs) deal with the impact.

A rate increase will increase financial costs, reduce financial liquidity, and cause SMEs to lose competitiveness in the market, said Sangchai Theerakulwanich, president of the federation.


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