Interest rates in Thailand should be cut quickly and sharply to help lift the economy out of “disaster”, says Kittiratt Na Ranong, who is widely expected to be named chairman of the board of the central bank.
A Pheu Thai Party loyalist and former finance minister and stock exchange president, Mr Kittiratt told a seminar on Thursday that interest rates were too high and all sides must work together to address that.
“It’s the way to prevent disaster. Today, I still believe that,” he said in reiterating a call he first made last year for fast and sharp cuts in interest rates to boost the economy.
The government has yet to confirm the selection of Mr Kittiratt as chairman of the board of the Bank of Thailand, but sources with knowledge of the process have confirmed to Reuters his selection, which has been widely reported in local media.
The government’s nomination of Kittiratt for the job faced strong opposition from economists and former Bank of Thailand governors concerned about political influence on the independent central bank.
The Pheu Thai-led government has been at odds with the central bank for the bulk of its time in office since returning to power in September 2023, mostly over interest rates it says are shackling the economy.
‘Intervene with thoughts’
Mr Kittiratt was finance minister in the government of Yingluck Shinawatra from 2012-14 and at the time he tangled frequently with the central bank governor.
His comments on Thursday came a day after the central bank’s Monetary Policy Committee left its key rate unchanged at 2.25% on Wednesday, after a surprise cut at its previous meeting in October.
Mr Kittiratt said the committee must have a reason for holding the rate, even though others felt a cut would have been helpful to the economy.
Regarding the BoT board chairmanship, Kittiratt said he has yet to be named to the position but, if appointed, he would perform his duty well.
“If you believe I will be able to do a good job, I must do good things to meet the expectations of all parties,” he said, without elaborating.
The BoT board chair does not have the power to order anything, Mr Kittiratt stressed, adding that holder would only “intervene with thoughts”.
Though the chairman cannot direct interest rate policy, the board selects the monetary policy committee, comprising the governor, two deputy governors and four outside experts.
The chairman will also have some influence on the selection of the next BoT governor when the incumbent, Sethaput Suthiwartnarueput, completes his term in September 2025.