BANGKOK (NNT) – The Bank of Thailand (BOT) says it is highly likely to raise its key policy rate at its August meeting, as other central banks move to tighten their monetary policy.

According to BOT Senior Director Don Nakornthab, weakness in the baht is still in line with those of trade partners and competitors, with the central bank ready to intervene if the Thai currency weakens too much.

The senior director said that if the baht weakens to 37 to the dollar but still moves in line with regional peers, the monetary policy committee (MPC) might overlook that as a factor in their decision because they usually watch currency competitiveness.

He added that the MPC would be deliberate in deciding how much the rate should be hiked, as Thailand’s economic recovery has lagged that of other countries.

Don said, “Chances are quite high for a rate hike in August, but by how much, the committee will have to consider.”

On Monday (11 July), BOT Governor Sethaput Suthiwartnarueput said Thailand would only gradually hike its key rate to tackle inflation and ensure an uninterrupted economic recovery.

Despite out-of-cycle policy tightening by other central banks, the BOT said earlier on Thursday (14 July) that it saw no need to call an urgent meeting to review policy before the next scheduled meeting on August 10, when economists expect a rate hike from a record low of 0.50%.

Singapore and the Philippines both announced out-of-cycle rate hikes on Thursday to tackle rising inflation.

Information and Source

Reporter : Natthaphon  Sangpolsit

Rewriter : Paul Rujopakarn

National News Bureau : http://thainews.prd.go.th

About the author

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Sign Up for Our Newsletter

Get notified of our weekly selection of news

You May Also Like

COVID-19 Drives Global Surge in use of Digital Payments

Three quarters of adults now have a bank or mobile money account; gender gap in account ownership narrows

Indonesia, Malaysia, Philippines, Singapore and Thailand sign MOU on cross-border payments

In the future, this payment connectivity initiative could be expanded to include other countries in the region as well as potential partner countries outside the region.

How long can the Bank of Thailand stay dovish?

The BOT is one of the few major Asian central banks to have kept rates at record lows since the pandemic began, but it recently signaled a policy shift as inflation surged to a near 14-year high in May.