Thailand’s Finance Minister Srettha Thavisin expressed disappointment in the Bank of Thailand’s decision to hold key interest rates steady, stating that a rate cut would have benefited the economy. Srettha has been advocating for a rate cut for months, as he believes the economy is in crisis and lagging behind regional peers. He emphasized that the central bank should consider the impact of its decisions on the people and the economy, without pressuring them to act.
The central bank’s decision to maintain rates at 2.50% was reached by a vote of 5-2 by its monetary policy committee. Despite pressure from the government, the bank stood firm in its decision, citing the current economic outlook and its potential for growth. Srettha, who is also the finance minister, has been openly critical of the central bank’s monetary policy direction, arguing that rate cuts are necessary to address issues such as high household debt and China’s economic slowdown.
Thailand’s economy unexpectedly contracted by 0.6% in the final quarter of 2023, leading to a downward revision in the growth outlook for 2024 by the state planning agency. While both authorities acknowledge differences in opinion on how best to stabilize and grow the economy in coming months, their ultimate goal remains economic stability and growth
