Bangkok (VNA) – The Thai Chamber of Commerce (TCC) has said it backs the decision by the Bank of Thailand, the country's central bank, to maintain the policy interest rate at 2.25%, considering the move as suitable for a reviving economy.
According to TCC Chairman Sanan Angubolkul, the decision by the Monetary Policy Committee’s on maintaining the policy rate at 2.25% is suitable for the country’s economic revival.
Sanan said that the Thai economy continues to grow and its inflation remains at an appropriate level, policymakers are likely to consider lowering policy interest rates in future meetings.
The official said he believes the current policy rate is at the right level to promote savings among Thais, adding the policy rates for developed countries will naturally be higher than those in developing countries.
However, the Thai economy may face uncertainties by trade wars that may intensify next year. Hence, he said, this is the right time for the central bank to step in and take contingency steps if the economy deteriorates.
He said the Thai Government plans to implement fiscal measures, including the plan to make shopping tax-deductible, the handing out of 10,000 THB (290.3 USD) to 4 million seniors in January, “You Fight, We Help” - the Government Housing Bank’s measure to waive interest for home loans for a set period, as well as the government granting subsidies to rice farmers.
These measures are all aimed at promoting economic circulation and are expected to save about 80-100 billion THB in interest costs in the next 12 months.
He added the export sector has been stronger than expected, while the interest rate cut in October is contributing positively to the economy. These factors are expected to stimulate economic activity in the first quarter of 2025.
The TCC Chairman assessed that with these factors, policymakers believe that there is no need to cut interest rates immediately to promote growth. Besides, the weak THB also benefits Thailand's exports and tourism.
Sanan said an interest rate cut could cause the THB to continue depreciating while maintaining higher interest rates can attract foreign investment. This is another reason for the MPC's recent decision./.
