January 16, 2024
BANGKOK – The current policy interest rate in Thailand is quite appropriate to the country’s economic landscape and recovery pace, the Bank of Thailand (BOT) insisted on Monday, in its latest response to the current debate which has seen some business leaders and analysts complain that interest rates should be reduced further because inflation has already slowed down.
During a media briefing, Piti Disyatat, secretary of the BOT’s Monetary Policy Committee, highlighted the country’s fragile economic structure.
He explained that the disinflation was due to government-supported measures, while real demand in the domestic market and export performance remained weak in comparison to other countries.
Noting that it is the BOT’s duty to consider the country’s long-term growth and overall financial stability, he insisted that the current policy interest rate is suited to the current situation.
He added that the BOT welcomes perspectives from all parties, as monetary policies must be revised on a regular basis if they are to be effective in maintaining the country’s economic stability.
He then highlighted some of the key policies that BOT will prioritise this year, which include improving lending conditions, putting in place targeted schemes to assist vulnerable debtors, the roadmap for open data, and the progress of the virtual bank.
“More regulations under the Responsible Lending scheme will be revised to relieve some of the burden faced by debtors in paying instalments and interest rates while also requiring creditors to adjust some conditions to help debtors continue their repayments,” Piti said.
Suwannee Jatsadasak, BOT’s assistant governor supervision, added that approvals for the virtual bank were progressing and an announcement would be made in the first quarter of this year.
“The BOT will then be open for applications and we will take time to consider their qualifications and technological offerings,” she said, adding that the country is expected to see the establishment of a virtual bank in the first half of 2026.