By Orathai Sriring
BANGKOK (Reuters) – Thailand’s interest rate board stuck to its pledge that monetary tightening would be gradual and measured, but noted that if the outlook for growth and inflation changes, the There will be adjustments from the assessment, the minutes of Wednesday’s meeting showed.
The minutes said monetary policy would face greater challenges in the period ahead, given the trade-off between addressing inflation amid rising demand-side inflationary pressures amid an improving economic outlook and support In the recovery scenario, some businesses and households remain vulnerable.
In January 02, the Monetary Policy Committee of the Bank of Thailand (BOT) voted unanimously to raise the one-day repo rate by 25 basis points to 1.50% in an attempt to bring inflation back within the target range.
It will review policy and update economic forecasts in March29, when most economists predict further rate hikes.
BOT’s current forecast is for economic growth of 3.7% this year. Last week, Deputy Prime Minister Supattanapong Punmeechaow predicted growth could reach 4 percent this year, driven by a tourism boom.
The minutes noted that the committee believed the economy would continue to expand, with tourism and private consumption gaining traction due to the return of Chinese tourists.
The minutes of the inflation risk meeting said that since then, while headline inflation has continued to decline, “core inflation is likely to remain elevated for longer than expected and thus needs to be closely monitored “.
Headline inflation fell to a nine-month low of 5.02% in January, but still Well above the BOT’s target range of 1-3%.
The baht rose against the dollar on expectations that mild U.S. austerity and China’s reopening would benefit Thailand’s tourism industry, the minutes said, adding that the committee would closely monitor the foreign exchange market’s fluctuation.
